VAT Calculator
$0.00 total price
How VAT Is Added or Removed
Value-added tax is calculated as a percentage of the net (pre-tax) price. To add VAT, the calculator multiplies the net price by the VAT rate to get the tax amount, then adds it to the net price to get the gross (total) price. To remove VAT from a gross price — useful when you have a receipt or price tag that already includes tax — it divides the gross price by (1 + VAT rate) to back out the net price, since gross price already equals net price times (1 + rate). This is the same standard method used for sales tax and GST calculations worldwide, just with different typical rates and naming conventions by country.
A Common Pitfall: Don't Just Subtract the Percentage
A frequent mistake when removing VAT from a total is subtracting the VAT percentage directly from the gross price (e.g., taking 20% off a $120 total to get $96). This is incorrect — the 20% VAT rate applies to the net price, not the gross price, so the actual net price is $120 ÷ 1.20 = $100, and the VAT portion is only $20, not $24. Always divide by (1 + rate), don't multiply by (1 − rate).
Related Calculations
If you're working out tax on a retail purchase in the United States rather than VAT, try the sales tax calculator instead, since U.S. sales tax is applied differently than VAT. For a quick discount calculation on a pre-tax or post-tax price, the discount calculator can help as well.
Frequently Asked Questions
How do I remove VAT from a price that already includes it?
Divide the gross (VAT-inclusive) price by 1 plus the VAT rate as a decimal. For example, at a 20% VAT rate, divide the total by 1.20 to get the net price, then subtract the net price from the total to find the VAT amount. Don't just subtract 20% from the total directly — that overstates the tax.
Why do different countries have different VAT rates?
Each country or region sets its own standard VAT rate (commonly 15-27% in the EU and UK, for example), and many also apply reduced rates to specific goods like food, books, or children's items. Enter your local standard or reduced rate in the calculator to match your situation, since there is no single global VAT rate.