VAT Calculator
Results
Results are calculated in real time. VAT rates are based on HMRC 2026/27 rates.
What are the UK VAT Rates for 2026/27?
Value Added Tax (VAT) is a consumption tax charged on taxable goods and services in the UK. Registered businesses collect VAT on sales (output tax) and reclaim VAT paid on commercial expenses (input tax).
| VAT Rate Tier | Statutory Percentage | Eligible Goods & Services |
|---|---|---|
| Standard Rate | 20% | Most consumer goods, adult clothing, professional services, electronics |
| Reduced Rate | 5% | Domestic energy, child safety car seats, mobility aids, smoking cessation |
| Zero Rate | 0% | Most staple food, books, children's clothes, public transport, new-build homes |
How Does the £90,000 Rolling VAT Registration Threshold Work?
In the UK, you must register for VAT if your VAT-taxable turnover exceeds £90,000 on a rolling 12-month basis, or if you expect your turnover to exceed £90,000 in the next 30 days alone (the 30-day forward-look test). It is not measured by the calendar year or tax year.
How Do You Calculate VAT Backwards (The 1/6th Fraction Trick)?
To extract 20% VAT from a gross (VAT-inclusive) total, you cannot simply subtract 20%, as this produces an incorrect figure. Instead, multiply the gross price by 1/6 (or divide by 1.20).
Step-by-Step VAT Calculations (Worked Examples)
The mathematical breakdowns below show exact formulas for gross-to-net reverse calculations and statutory additions.
Reverse VAT on £1,200 Gross Invoice (1/6th Fraction)
Demonstrates the 1/6th mathematical anchor.
Adding 20% Standard VAT to £500 Services
Standard business supply addition formula.
5% Reduced VAT on £240 Domestic Fuel
Demonstrates reduced rate application.
Frequently Asked Questions
The statutory UK VAT registration threshold is £90,000 based on a rolling 12-month taxable turnover or a 30-day forward-look test, not a fixed calendar or tax year.
To extract 20% VAT from a gross amount, multiply the gross price by the 1/6th VAT fraction (or divide gross by 1.20). Subtracting 20% directly produces an incorrect figure.
The UK has three VAT rates: 20% standard rate (most goods/services), 5% reduced rate (domestic energy, children's car seats), and 0% zero rate (most food, books, children's clothing).
The Flat Rate Scheme allows small businesses with turnover up to £150,000 to pay a fixed statutory percentage (4% to 16.5% depending on industry sector) of gross turnover directly to HMRC.
Zero-rated items (0% VAT) include basic food and drink, books, newspapers, children's clothing, public transport, and new-build residential property, allowing businesses to still reclaim input VAT.