Add VAT to a net price or take it out of a gross price at the standard, reduced or zero rate.
The standard rate of UK VAT is 20%. A reduced rate of 5% applies to a few goods and services such as domestic fuel and power, and a zero rate applies to items like most food and children’s clothing. Zero-rated sales are still reported on your VAT return.
To remove 20% VAT you divide by 1.2 — not subtract 20%, which is a very common mistake.
You must register for VAT if your taxable turnover goes over £90,000 in a rolling 12 months (the threshold from 1 April 2024). You can also register voluntarily below it. VAT-registered businesses must follow Making Tax Digital: keep digital records and file returns through MTD-compatible software.
ETaxFlow posts every sale and bill to your VAT return automatically.
The standard rate is 20%. A reduced rate of 5% and a zero rate of 0% apply to specific goods and services.
Divide the gross price by 1.2 to get the net price at 20% VAT, then subtract the net from the gross to find the VAT. Do not simply subtract 20%.
When your taxable turnover exceeds £90,000 in any rolling 12-month period, or you expect it to in the next 30 days. You can register voluntarily below the threshold.
Yes. Zero-rated sales are taxable at 0% and are reported on the return, unlike exempt supplies, which sit outside the VAT calculation.
No. It is a quick calculator. ETaxFlow generates MTD-compatible VAT return data from your accounting records for submission through compatible software.
Go deeper on the rules behind the numbers