VAT Calculator


VAT Calculator

Are you wondering how much VAT you need to pay? Our VAT Calculator makes it simple. Our calculator calculates VAT inclusive as well as exclusive. It’s
perfect for every business owner or anyone who needs to calculate the VAT amount. You just have to add the numbers for inclusion and get the VAT amount instantly from the provided VAT Tax Calculator. No confusion or difficulty just easy calculations at your fingertips.

What is VAT?

VAT stands for value added tax. VAT is an indirect tax that is imposed on goods and services whenever the value is added from the production to the point of sale. Each business in the supply chain can claim a credit for the VAT already paid. However , the final consumer cannot claim this credit, making VAT a tax on the end consumption. It’s a major source of government revenue
worldwide, used in 160 countries.

A picture on which VAT is shown in text form.

How To Calculate VAT by using a VAT Calculator?

Calculating VAT is difficult, but using our Online VAT Calculator, you can calculate your tax within three clicks. Just follow these steps:

How to add VAT?

  • Enter the exclusive amount.
  • Verify the VAT Rate.
  • Click the add button.

How to remove VAT?

  • Enter the inclusive amount.
  • Verify the VAT Rate.
  • Click the remove button.

Method to calculate VAT manually?

Calculating VAT manually is the most searched question. Here we got the solution to this complicated question within three easy steps. Here’s an example.

How to add VAT manually?

Let’s say the product’s base price is 100$ and the VAT Rate is 20%. (According to UK VAT Rate)

  • Base Price = £100
  • VAT Amount = Base Price × VAT Rate = £100 × 0.20 = £20
  • Total Price Including VAT = Base Price + VAT Amount = £100 + £20 = £120

So, the total price of the item, including VAT, would be £120.

How to remove VAT manually?

Let’s say the total price of an item, including VAT, is £120 and the VAT rate is 20%.

  • Total Price Including VAT = 120$
  • VAT Amount = Total Price × VAT Rate = 120$ × 0.20 = 24$
  • Base Price Excluding VAT = Total Price – VAT Amount = 120$ – 24$ = 96$

So, in this example, if the total price including VAT is 120$ and the VAT rate is 20%, then the base price excluding VAT would be 9$.

A picture in which calculation is shown with the help of a caalculator and some money.

VAT Standard Rate

It is the default rate of VAT that is applied to most of the goods and services. It’s a higher
percentage and is the most common VAT rate you will encounter. For example, the stander VAT rate in the UK is 20%.

VAT Reduced Rate

It is a lower rate of VAT that is applied to specific goods and services. It must be essential and
proves to be beneficial for the public. For example reduced VAT rate in UK is 5%.

Example of VAT Process

Here is an example of VAT process that will make your concepts more clear about it. Here is the
supply chain of roasted almonds:

Local Farmer and Almonds:

  • Farmer sells fresh almonds at $5.00 per kilogram.
  • Farmer charges 10% VAT, amounting to $0.50.
  • Farmer receives a total of $5.50 per pound from the roaster.

Roasting Process

  • Sells roasted almonds to the dry fruit shop at $10.00 per kilogram.
  • Charges 10% VAT , which is $1.00.
  • The roaster pays $0.50 in VAT to the government (as the farmer already paid $0.50).

Dry Fruit Shop Sales:

  • The shopkeeper makes 5 packs of every 1 kilogram.
  • Sells each packet for $4.00, totaling $20.00 for 5 packets.
  • Charges 10% VAT, adding up to $2.00 on the $20.00 sales.
  • Receives a total of $22.00 from customers for every 5 packets sold.
  • Pays $1.00 in VAT to the government (as $1.00 has already been paid by the farmer and roaster).

What is the VAT Refund Period?

Here are the VAT refund periods:

Cross-border refunds for EU Businesses:

  • When EU Businesses engage in cross-border trade within the EU, they can claim refunds for VAT paid in these transactions.

VAT refund for non-EU Enterprises:

  • Companies not based in the EU are eligible for VAT exclusions when conducting business with EU countries, allowing them to reclaim VAT paid.

VAT refunds for Foreign Tourists:

  • Tourists from outside can recover VAT made on their purchases made during their visit.
FAQs About Value Added Tax

How to calculate VAT from gross?

You must divide the gross amount by 1+ VAT percentage in order to calculate VAT using the
gross amount.

How to calculate inclusive VAT?

By using the following formula you will be able to calculate inclusive V A T from exclusive V A T .
Formula:
Amount of inclusive V A T = (Amount of exclusive V A T) x (100 + V A T % as a figure) / 100

How to calculate exclusive VAT?

By using this formula you can easily calculate exclusive VAT.
Excl. = [Incl./(100+V A T%)] x 100

How VAT is calculated, gross or net?

When computing VAT on a net number , the net amount is equal to 100% and the gross is
calculated by adding the VAT percentage.

How to calculate UK VAT?

For calculating the UK VAT you have to increase the price of items or services by 20%. This can
be done by multiplying the price you charge by 1.2 .