VAT calculator
Add or remove UK VAT with one click and check whether your business must register for VAT. Rates and threshold according to HMRC, as at 25 October 2026.
How we calculate
- Adding VAT: VAT = net amount × rate. Example: £1,000 + 20% = £200 VAT, total £1,200.
- Removing VAT from a gross price: net = gross ÷ (1 + rate). At 20%, VAT is 1/6 of the gross price – £200 of £1,200.
- Registration threshold: each month you add up VAT-taxable turnover for the last 12 months. If it exceeds £90 000, you must register with HMRC within 30 days of the end of that month. Registration is also compulsory if you expect to exceed £90,000 in the next 30 days alone.
- Deregistration is possible when turnover falls below £88,000.
Legal basis
- Value Added Tax Act 1994 – the main VAT law in the United Kingdom.
- s. 2 – the 20% standard rate; s. 29A and Schedule 7A – the 5% reduced rate.
- Schedule 8 – zero-rated supplies (including food, books, children’s clothing).
- Schedule 1 – the registration requirement and thresholds; current amounts: GOV.UK – VAT thresholds.
What to do now
- Approaching £90,000? Check your turnover every month. Late registration means paying VAT from the date you should have registered, plus a penalty – VAT registration (GOV.UK).
- After registering you issue VAT invoices (with VAT number, date, rate and VAT amount) and file returns digitally under Making Tax Digital – MTD for VAT (GOV.UK).
- Check the rate for your sector – some goods and services are 5%, 0% or exempt – VAT rates on goods and services (GOV.UK).
- Selling to Poland or the EU? Since Brexit, export and import rules apply – ask your accountant before your first shipment.
Frequently asked questions
What is the difference between 0% and VAT exemption?
Zero-rated sales count towards turnover and let you reclaim VAT on purchases. Exempt sales (e.g. some financial, insurance and education services) do not count towards the registration threshold and usually do not give the right to reclaim VAT.
Can I register voluntarily below the threshold?
Yes. Voluntary registration can pay off if you sell mainly to VAT-registered businesses and have large VAT-bearing purchases to reclaim.
Is VAT in the UK and in Poland the same?
No. The standard rate is 23% in Poland and 20% in the UK, and thresholds, returns and authorities are separate. A business operating in both countries may have obligations in each.
What is the Flat Rate Scheme?
A simplified scheme for small businesses: you pay HMRC a fixed percentage of gross turnover depending on your sector, instead of accounting for VAT on every purchase. It does not always pay off – especially with low costs (“limited cost trader”).
Important: the calculator gives estimated amounts. The rate for a specific good or service depends on the law and HMRC’s interpretation. This is not tax advice.
Sources: GOV.UK – VAT rates · GOV.UK – registration thresholds · GOV.UK – when to register
Background: City of London, photo Matt Brown / Wikimedia Commons, CC BY 2.0 · Law and rates as at 25 October 2026
