Calculate Value Added Tax (VAT) for UK and EU transactions. Add or remove VAT from prices with customizable tax rates for different countries.
A VAT calculator computes Value Added Tax for UK and EU transactions based on net amount (price before tax) or gross amount (price including tax), and applicable VAT rate. UK standard rate: 20% (most goods/services), reduced rate: 5% (domestic energy, children's car seats), zero rate: 0% (food, books, children's clothes, newspapers). EU rates vary by country: 17-27% standard rates. Calculates VAT amount, net price, and gross price. Essential for businesses setting prices, invoicing clients, reclaiming VAT, completing VAT returns, and consumers understanding tax components of purchases.
Price products correctly: if want £100 after-tax selling price, must price at £83.33 + 20% VAT = £100 gross; pricing at £100 + VAT = £120 makes product uncompetitive. Calculate reclaimable VAT on business purchases: buying £1,000 + £200 VAT equipment allows reclaiming £200 from HMRC, reducing effective cost to £1,000. Invoice accurately: separate invoice must show net amount, VAT amount, and gross total for clients to reclaim VAT. Complete VAT returns correctly: quarterly returns require calculating VAT owed (output tax on sales minus input tax on purchases). Understand pricing impact: 20% VAT makes £100 pre-tax item cost £120 final price to consumer. Compare VAT-inclusive versus VAT-exclusive pricing in B2B versus B2C contexts—B2B typically quotes net prices (clients reclaim VAT), B2C quotes gross prices (includes VAT).
Choose calculation direction: (1) Net to Gross: enter net amount (pre-VAT price) and VAT rate (20% standard, 5% reduced, 0% zero-rated) to calculate VAT amount and gross total, or (2) Gross to Net: enter gross amount (VAT-inclusive price) and VAT rate to extract VAT amount and net price. For reverse calculation (finding net from gross): Net = Gross / 1.20 (for 20% VAT), VAT = Gross - Net. Example: £240 gross price at 20% VAT = £240/1.20 = £200 net, VAT = £40. For EU transactions: select country to apply correct rate (Germany 19%, France 20%, Hungary 27%). VAT registration required in UK when taxable turnover exceeds £90,000 annual threshold (2024). Businesses charge VAT on sales (output tax), reclaim VAT on purchases (input tax), and remit difference to HMRC quarterly. Certain transactions exempt (finance, insurance, education, healthcare) or outside scope (wages, business loans).
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Common questions about vat calculator (uk/eu)