VAT Calculator

Add VAT to net prices or extract VAT from gross totals instantly. Calculate net price, VAT tax amount, and gross invoice total with standard international rates.

VAT Parameters

Total Gross Invoice Payable$120.00
20% VAT Rate Applied
Net Base Price$100.00
VAT Tax Amount$20.00
Gross Total$120.00

Itemized Invoice Breakdown

Net Tax-Exclusive Amount$100.00
Value Added Tax (20%)+$20.00
Total Gross Invoice Price$120.00

Adding VAT to Quotations

When quoting B2C customers in Europe or the UK, prices must legally be shown inclusive of 20% VAT ($120.00).

Understanding Value Added Tax (VAT) Calculations

Value Added Tax (VAT) is an indirect multi-stage consumption tax levied on goods and services across Europe, the UK, Australia (as GST), and over 160 countries worldwide. Accurately converting between tax-exclusive (net) and tax-inclusive (gross) amounts is essential for issuing invoices, filing quarterly VAT returns, and setting retail pricing.

1. Adding VAT (Net to Gross Formula)
Gross Total=Net Base×
(1 +
VAT Rate100
)
2. Extracting / Removing VAT (Gross to Net Formula)
Net Base=
Gross Total1 + (VAT Rate ÷ 100)
;VAT Amount=Gross Total − Net Base
Step-by-Step Worked Examples (20% Standard VAT Rate)
Example A: Adding 20% VAT to a $150.00 Net Product
VAT Amount=$150.00 × 0.20=$30.00
Gross Total=$150.00 + $30.00=$180.00
Example B: Extracting 20% VAT from a $240.00 Gross Receipt
Net Base=$240.00 ÷ 1.20=$200.00
Extracted VAT=$240.00 − $200.00=$40.00

Standard VAT Rates Across Major Jurisdictions

CountryStandard RateReduced RateTax Type Name
United Kingdom20%5% / 0%VAT (Value Added Tax)
Germany19%7%MwSt (Mehrwertsteuer)
France20%10% / 5.5%TVA (Taxe sur la valeur ajoutée)
Ireland23%13.5% / 9%VAT (Value Added Tax)
Australia10%0%GST (Goods and Services Tax)

Frequently Asked Questions

What is the difference between VAT-inclusive and VAT-exclusive pricing?
VAT-exclusive (Net) pricing means the listed price does not include value added tax; the tax is added during invoice generation or checkout. VAT-inclusive (Gross) pricing means the final sticker price already includes the applicable VAT percentage.
How do I reverse calculate or extract VAT from a gross total?
To extract VAT from a gross amount, divide the gross total by (1 + VAT rate as decimal). For example, with a 20% VAT rate, divide the total price by 1.20 to get the original net price. The difference between gross and net is your extracted VAT amount.
Why can't I just subtract 20% from a gross price to remove 20% VAT?
Subtracting 20% directly from a $120 gross price gives $96 (a $24 deduction), which is mathematically incorrect because the original 20% tax was applied to the $100 net base ($20 tax), not the $120 total. Dividing by 1.20 accurately restores the $100 base.
Can I input custom or reduced VAT rates?
Yes. You can type any custom percentage (e.g. 5% reduced rate for home energy or 0% zero-rated essentials) directly into the VAT rate input field.
How does VAT differ from US sales tax?
VAT is an indirect consumption tax collected incrementally at every stage of the supply chain based on the value added. In contrast, US sales tax is a single-stage tax assessed only at the final retail point of sale to the end consumer.

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