# UK VAT Calculator

> Add or remove UK VAT at the standard 20% rate, the reduced 5% rate on domestic fuel, or zero. Shows the VAT fraction for each band and offers the HMRC rounding concession that lets an invoice trader round the tax down.

Use it: https://tessalor.com/en/country/uk-vat

This tool runs entirely in the browser. Nothing entered into it is uploaded.

## Formula

```
Adding VAT to a price that excludes it:
  vat   = round(net x rate / 100)
  gross = net + vat

Removing VAT from a price that includes it:
  vat = round(gross x rate / (100 + rate))
  net = gross - vat

UK bands and their VAT fractions:
  standard    20%   20/120 = 1/6
  reduced      5%    5/105 = 1/21
  zero         0%    no tax

round = to the nearest penny, or towards zero when the
        invoice trader's concession is chosen

Only the VAT is rounded. The third figure is derived from
the other two, so net + vat = gross to the penny, always.
```

## Assumptions

- The three bands are the rates in force. Which band a supply falls in is a question about the supply rather than about arithmetic, and HMRC publishes the lists — this tool applies a rate, it does not classify goods.
- Rounding is applied to the VAT and the third figure is derived from the other two. Rounding all three independently leaves them a penny apart whenever both halves land on a half-penny, which is how an invoice fails to add to its own total.
- The rounding concession is written for traders issuing VAT invoices. It is not the general rule and not a retail scheme, which is why it is off by default.
- Historic rates are not held here. The standard rate was 17.5% until 3 January 2011 and 15% for thirteen months before that, and those go in the "Another rate" field — which starts on 17.5 because re-checking an old invoice is the usual reason to need it.
- Figures are in pounds because UK VAT is denominated in pounds. Nothing is converted and no exchange rate is applied anywhere.

## Inputs

| Name | Label | Type | Default | Range |
| --- | --- | --- | --- | --- |
| `amount` | Amount | currency | 100 | 0 to 1000000000 |
| `direction` | What to do with it | select | add |  |
| `band` | Rate band | select | standard |  |
| `rate` | Another rate | percent | 17.5 | 0 to 100 |
| `rounding` | Round the VAT | select | nearest |  |

## Outputs

- `vatAmount` — VAT (currency), primary
- `netAmount` — Price before VAT (currency)
- `grossAmount` — Price including VAT (currency)
- `rateApplied` — Rate applied (percent)
- `fraction` — VAT fraction (text)

## Questions

### What are the current UK VAT rates?

Three: the standard rate of 20%, which has applied since 4 January 2011 and covers most goods and services; a reduced rate of 5% on domestic fuel and power, children's car seats, mobility aids and a short published list besides; and a zero rate on most food, children's clothes, books, newspapers, public transport and prescription medicines. Exempt supplies — insurance, postage stamps, most financial and property transactions — are a fourth thing and are not a rate of zero.

### What is the VAT fraction, and why is it one sixth?

It is the share of a VAT-inclusive price that is tax. At 20% the gross is 120% of the net, so the tax is 20/120 of the gross, which reduces to one sixth. At 5% it is 5/105, or one twenty-first. HMRC publishes these in VAT Notice 700 precisely so the sum can be done on the gross without working backwards, and this tool shows the fraction for whichever band you pick.

### Can I round VAT down to the nearest penny?

If you issue VAT invoices, yes. The HMRC concession allows the tax on an invoice to be rounded down to a whole penny rather than to the nearest, because it is tax-neutral — your output tax and your customer's input tax move together. It applies per line rather than to the invoice total, and it is not the model for a retailer computing VAT out of gross takings under a retail scheme.

### Is zero-rated the same as exempt?

No, and the difference decides whether you can reclaim. A zero-rated supply is taxable at 0%, so the tax on it is nil and you can still recover the VAT on what you bought to make it. An exempt supply is outside the charge, and input tax attributable to it is not recoverable at all. Both show nothing on the invoice, which is why they get confused.

### What was the UK rate before 2011?

17.5%, from April 1991 until 3 January 2011, apart from thirteen months at 15% between December 2008 and January 2010. The "Another rate" field starts on 17.5 for exactly this reason. Its VAT fraction is 7/47, which is a fair demonstration that these fractions are usually untidy and that one sixth is the lucky case rather than the normal one.

### Do I charge UK VAT to a customer abroad?

Usually not, but it turns on the place of supply rather than on where you are. Goods exported outside the UK are generally zero-rated with evidence of export; services to a business customer overseas are usually outside the scope, with the customer accounting for their own country's tax; sales to consumers in the EU may need registration there. This tool computes a rate, not whether you charge it.

## Sources

- [VAT rates — the standard, reduced and zero bands](https://www.gov.uk/vat-rates) — HM Revenue & Customs, applies to 2026. Retrieved 2026-07-31.
- [VAT guide (VAT Notice 700), paragraph 7.3.1 — the VAT fraction](https://www.gov.uk/guidance/vat-guide-notice-700) — HM Revenue & Customs, applies to 2026. Retrieved 2026-07-31.
- [VATREC12010: what is the rounding concession?](https://www.gov.uk/hmrc-internal-manuals/vat-trader-records/vatrec12010) — HM Revenue & Customs. Retrieved 2026-07-31.
- [VAT on fuel and power, Research Paper 97/87 — the 8% to 5% reduction](https://researchbriefings.files.parliament.uk/documents/RP97-87/RP97-87.pdf) — House of Commons Library. Retrieved 2026-07-31.
- [Rates of VAT on different goods and services](https://www.gov.uk/guidance/rates-of-vat-on-different-goods-and-services) — HM Revenue & Customs, applies to 2026. Retrieved 2026-07-31.

## Variants

- [How much VAT is on a domestic gas or electricity bill?](https://tessalor.com/en/country/uk-vat/vat-on-a-domestic-energy-bill)
- [Can I round VAT down to the penny on an invoice?](https://tessalor.com/en/country/uk-vat/rounding-vat-down-on-an-invoice)

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Estimate, not advice. See https://tessalor.com/en/disclaimer.
Machine-readable catalogue: https://tessalor.com/api/tools.json