VAT Calculator
Add or remove VAT from a price to find the net amount, VAT amount, or gross price.
About the VAT Calculator
Value-added tax is charged in most countries outside the US, and pricing conversations constantly move between "net" (before tax) and "gross" (after tax) amounts. This calculator handles both directions: adding VAT onto a net price, or extracting the net price and VAT amount from a tax-inclusive gross price.
How It Works
When adding VAT, the calculator multiplies your net amount by the VAT rate to find the tax, then adds it to get the gross price. When removing VAT from a gross price, it divides the gross amount by one plus the VAT rate to back out the net price, then finds the VAT amount as the difference — since simply multiplying the gross price by the rate would overstate the tax.
Adding: Gross = Net × (1 + rate). Removing: Net = Gross / (1 + rate); VAT = Gross − Net.
Worked example
Scenario: Adding 20% VAT to a net price of 120.
- VAT amount: 120 × 20% = 24.
- Gross price: 120 + 24 = 144.
- Reverse check: 144 ÷ 1.20 = 120 net, 24 VAT.
Result: A gross price of 144, including 24 of VAT.
VAT-inclusive and VAT-exclusive prices
Adding VAT to a net price and extracting VAT from a tax-inclusive price use different calculations. When working backwards from a VAT-inclusive total, do not simply subtract the VAT percentage from the total.
Tips and common mistakes
- To remove VAT, divide by 1 + rate — do not subtract 20% of the gross (144 − 28.80 gives the wrong net of 115.20).
- Rates differ by country and by product (standard, reduced, zero), so check the rate for your item.
- Keep net and VAT amounts separate on invoices; businesses usually reclaim the VAT part.
Assumptions & Limitations
- Uses a single flat VAT rate applied to the full amount — some jurisdictions use reduced rates for specific goods.
- Assumes the amount entered does not already include any other taxes.
- VAT rates and rules vary by country and product category — confirm the applicable rate for your jurisdiction before relying on this for filing.
- Does not handle mixed-rate invoices with multiple line items at different VAT rates.