Guide · Updated 2026-10-08
Reverse VAT Calculation: Take VAT Off a Price (UK)
Work out the net price and VAT from a price that already includes VAT. Divide by 1.2 for 20 percent VAT, with worked examples, the 1/6 shortcut and common mistakes.
A reverse VAT calculation works backwards from a price that already includes VAT to find the price before VAT and the VAT itself. For the UK standard rate of 20 percent, divide the VAT-inclusive price by 1.2. For example, £120 including VAT is £100 plus £20 VAT.
The formula
- Net price = gross price / 1.2 (for 20% VAT)
- VAT = gross price - net price
- Shortcut: VAT is one sixth of a 20% VAT-inclusive price (gross / 6)
Worked examples at 20% VAT
| Price including VAT | Net price (divide by 1.2) | VAT |
|---|---|---|
| £120.00 | £100.00 | £20.00 |
| £250.00 | £208.33 | £41.67 |
| £500.00 | £416.67 | £83.33 |
| £1,000.00 | £833.33 | £166.67 |
Other UK VAT rates
- 5% reduced rate: divide by 1.05. £105 including VAT is £100 net and £5 VAT. The VAT is one twenty-first (gross / 21).
- 0% zero rate: there is no VAT to remove.
The most common mistake
Do not take 20 percent off the VAT-inclusive price. Twenty percent of £120 is £24, which would give £96. That is wrong, because the 20 percent VAT was added to the net price, not to the total. Dividing by 1.2 gives the correct £100.
When you need a reverse calculation
- Your supplier gives you a shelf price that includes VAT and you need the net cost for your accounts.
- You are VAT registered and need to separate VAT on a receipt so you can reclaim it.
- You want to show customers the net price and VAT separately on an invoice.
- You are comparing a VAT-inclusive consumer price with a business net price.
Adding VAT again
To go the other way, multiply the net price by 1.2. £100 net is £120 including VAT. The VAT Calculator does both directions for 20, 5 and 0 percent, and shows the VAT amount separately.
Using it on invoices
A VAT invoice must show the net amount, the VAT rate, the VAT amount and the total, along with your VAT number. Build one with the Invoice Generator, and check your margin after VAT with the Profit Margin Calculator.
Frequently asked questions
How do I find the VAT amount from a total? Divide the total by 6 for 20 percent VAT, or by 21 for 5 percent VAT.
What is the VAT fraction? It is the share of a VAT-inclusive price that is VAT: 1/6 at 20 percent and 1/21 at 5 percent.
Does this work for other countries? The method is the same, but the rate differs. For other countries see our VAT, GST and sales tax calculators.
Rates can change. Check GOV.UK for current VAT rules. This guide is general information, not tax advice.