Remove UK VAT from any gross price instantly. Extract the net amount and VAT portion at 20%, 5%, or 0%.
If you have a net base price and need to calculate standard 20%, reduced 5%, or zero-rate VAT to find the total invoice amount, use our forward calculator.
| VAT Rate | Divide Gross By | VAT Fraction | Example (£120 gross) |
|---|---|---|---|
| 20% | 1.20 | 1/6 | £100 net + £20 VAT |
| 5% | 1.05 | 1/21 | £114.29 net + £5.71 VAT |
| 0% | 1.00 | 0 | £120 net + £0 VAT |
For informational purposes only. Tax rates change frequently — verify with your state's Department of Revenue before filing. This tool is not a substitute for professional tax advice.
· Rates verified quarterly from the Tax Foundation and state Departments of Revenue.
Reverse VAT calculation is essential when you have a VAT-inclusive total and need to determine the underlying net amount and VAT component. This is the standard situation for UK consumers looking at receipts, employees filing expense claims, accountants processing supplier invoices, and businesses preparing quarterly MTD VAT returns. UK retail prices always include VAT by law, so reverse calculation is how you extract the tax element.
The formula is straightforward: Net Price = Gross Price ÷ (1 + VAT Rate ÷ 100). At the standard 20% rate, this simplifies to dividing by 1.20. A useful shortcut is the 'VAT fraction' — to find just the VAT amount at 20%, divide the gross by 6 (because 20/120 = 1/6). For the 5% reduced rate, the fraction is 1/21. These fractions are widely used by UK accountants for quick mental arithmetic.
For VAT-registered businesses, reverse-calculating VAT isn't just informational — it's the first step in recovering input VAT. Under HMRC rules, you can reclaim VAT on business expenses provided you have a valid VAT invoice, the expense relates to taxable business supplies, and you're not using the Flat Rate Scheme (which trades input VAT recovery for simplified accounting). Accurate reverse calculation ensures your VAT return is correct and you claim every penny you're entitled to.
Quick answers to the most common questions users ask.
Divide the gross (VAT-inclusive) price by 1.20. For example, £240 ÷ 1.20 = £200 net price. The VAT portion is £240 – £200 = £40. This is the standard reverse VAT calculation used across the UK.
Net Price = Gross Price ÷ (1 + VAT Rate ÷ 100). For the standard 20% rate: Net = Gross ÷ 1.20. For the reduced 5% rate: Net = Gross ÷ 1.05. The VAT amount is always Gross – Net.
Common scenarios include: extracting VAT from till receipts for expense claims, separating VAT on supplier invoices for input tax recovery, calculating the VAT element of mixed supplies, preparing VAT returns when you only have gross figures, and auditing petty cash receipts.
Only if you are VAT-registered and the expense is for business purposes with a valid VAT invoice. The reverse calculation helps you identify how much VAT is included, but reclaiming it on your VAT return requires proper documentation.
The VAT fraction is 1/6. To find the VAT in a gross price at 20%, divide by 6. For example, £120 ÷ 6 = £20 VAT. This is a shortcut: since 20% = 1/5 of the net, it equals 1/6 of the gross. For 5% VAT, the fraction is 1/21.
The reverse calculation gives you the actual VAT content of a price. However, if you're on HMRC's Flat Rate Scheme, you pay VAT at your sector-specific flat rate on gross turnover rather than reclaiming input VAT item by item. The reverse calculation is still useful for record-keeping and understanding your margins.
Explore our complete suite of UK VAT calculators.
All rates, thresholds, and regulatory guidance cited on this page are sourced from official government publications and non-partisan research institutions.
European Commission — VAT Guide
Comprehensive portal for VAT rates and rules across all 27 EU member states, including B2B/B2C regulations.
ec.europa.euOECD — Consumption Tax Database
Global comparative data on VAT/GST structures and consumption tax trends across OECD member nations.
oecd.orgTaxesLedger is an independent educational tool. We are not affiliated with any government agency. Rates are verified quarterly; always confirm with your jurisdiction's official Department of Revenue before filing. Last verification: May 15, 2026.
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