VAT Calculator · Practical guide

How to Remove VAT From a Price

Divide the tax-inclusive price by 1 plus the VAT rate — never just subtract the percentage off the total.

At a glance

The Short Answer

To remove VAT, divide the gross (tax-inclusive) price by 1 + rate. At 20%, divide by 1.20: a £120.00 price becomes £100.00 net, and the VAT portion is £120.00 − £100.00 = £20.00. Choose Remove VAT in the calculator above and it shows net, VAT, and gross in one step.

Interactive tool

VAT Calculator

Enter your own values, then compare the result with the examples below.

VAT Breakdown

Net Amount
VAT Amount
Gross Amount

The Formula

net = gross ÷ (1 + rate) and VAT = gross − net, with the rate as a decimal (20% = 0.20). You divide instead of multiply because the tax was charged on the net price, not the gross.

Why Taking 20% Off the Gross Is Wrong

A common mistake: £120.00 × 20% = £24.00, so people assume the VAT is £24.00 and the net is £96.00. Prove it wrong in reverse — £96.00 plus 20% VAT is £96.00 × 1.20 = £115.20, not £120.00. The true VAT of £20.00 is 20% of the net but only 16.67% of the gross.

VAT Share of a Tax-Inclusive Price

The VAT inside a gross price is always rate ÷ (1 + rate):

VAT RateVAT Share of GrossVAT in a 100.00 Gross Price
5%4.76%4.76
19%15.97%15.97
20%16.67%16.67
21%17.36%17.36
25%20.00%20.00

So a 100.00 receipt at a 20% rate contains 16.67 of VAT and 83.33 of net — handy for expense reports and reclaim calculations.

Frequently Asked Questions

How do I calculate net from gross at 20% VAT?

Divide the gross amount by 1.20. A £240.00 gross price gives £200.00 net, with £40.00 of VAT.

What fraction of a VAT-inclusive price is the tax?

Rate divided by 1 plus rate. At 20% that is 20/120 = 16.67% of the gross; at 25% it is exactly 20% of the gross.

Why is removing VAT done by dividing?

Because the rate was applied to the pre-tax net price, not the total. Dividing by 1 + rate reverses that multiplication exactly.

Does this work for reduced VAT rates?

Yes. Use the same formula with the reduced rate — at 5%, divide the gross by 1.05 to get the net amount.