UK VAT rates
The standard rate is 20%, applied to most goods and services. A reduced 5% rate covers things like domestic energy and children’s car seats, and a 0% rate applies to most food, books and children’s clothing.
Removing VAT from a gross price
To find the net price from a VAT-inclusive total, divide by 1.20 (for 20%). The difference is the VAT. Switch the calculator to “Remove VAT” to do this automatically.
Frequently asked questions
How do I remove 20% VAT?
Divide the gross amount by 1.2, not by 0.8. £120 inc-VAT ÷ 1.2 = £100 net, so the VAT is £20.
When must a business register for VAT?
When VAT-taxable turnover exceeds the registration threshold (£90,000). Below that, registration is voluntary.