Add VAT to a net price or strip it back out of a gross one, using the standard rate for your country — with the reverse-charge case flagged where it applies.
1,000 GBP × 20% = 200 GBP tax → 1,200 GBP totalThis is the net → gross direction: the tax is calculated on the net, and the customer pays net plus tax.
Standard headline rates only. Reduced and zero rates exist for many goods and services — verify the correct treatment for your specific supply before issuing the invoice.
Adding VAT is straightforward: net × rate. Removing it is not, because the gross already contains the tax. The correct reverse calculation divides by (1 + rate) — so stripping 20% out of a 1,200 gross gives a net of 1,000 and VAT of 200, not a net of 960.
The shortcut that trips people up is subtracting the rate percentage from the gross. At 20% that under-reports the tax by about 3% of the gross, and on a large invoice it is the difference between a correct return and a correction letter from the tax office.
EU and UK cross-border B2B services bring the reverse-charge rule: if both parties are VAT-registered and the supply is in scope, the supplier invoices at 0% and the customer self-accounts for the VAT. The invoice still has to show the VAT number of both parties and state the reverse-charge note — omitting it is a common cause of a rejected invoice.
UK flat-rate scheme users invoice at the standard rate but pay a fixed percentage to HMRC, so the calculator’s net and tax figures are still the right ones for the customer-facing document.
Divide the gross amount by 1 + (rate ÷ 100). For 20% VAT on a 1,200 total: 1,200 ÷ 1.2 = 1,000 net, leaving 200 of VAT. Do not simply subtract 20% of the gross, which would give 960 and understate the tax.
For most cross-border B2B services within the EU, and certain UK and international supplies, the customer accounts for the VAT instead of the supplier. You invoice at 0%, show both VAT numbers, and add a reverse-charge statement to the invoice.
That depends on the supply and the country of your customer — standard, reduced and zero rates all exist, and place-of-supply rules decide which country’s rate applies. This calculator uses standard headline rates; confirm your specific treatment before billing.
The net-to-gross arithmetic is the same, and the country presets include GST and consumption-tax jurisdictions. For Indian GST you also need to split the tax between CGST/SGST or IGST — use the GST calculator for that.