B/Billable Toolkit
Free calculators for freelancers & small businesses
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Sales Tax & VAT Calculator

Add tax to a net price, or work backwards from a price that already includes tax.

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Common rates

Rates change and some goods have reduced rates. Confirm the rate for your item.

Result

How it’s calculated

Adding tax multiplies the net price by one plus the rate. Removing tax divides the gross price by one plus the rate — subtracting the percentage directly gives the wrong answer.

add: gross = net × (1 + rate) remove: net = gross ÷ (1 + rate)

Worked example

£1,250 plus 20% VAT is £1,500. To take VAT out of £120, divide by 1.2: the net price is £100 and the VAT is £20.

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Questions

How do I remove 20% VAT from a price?

Divide the price by 1.2. For £120 including VAT, the net price is £100 and the VAT is £20.

Why can't I just subtract 20%?

The tax was calculated on the net price, not the gross price, so subtracting 20% of the gross takes off too much.

Doing these numbers every month? Accounting software can automate invoices, reminders and tax reports.

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