How reverse VAT works
A VAT-inclusive price is the net price plus VAT. To go backwards, you divide by 1 plus the VAT rate:
Net price = Gross price ÷ (1 + VAT rate)
VAT = Gross price − Net price
At the 20% standard rate you divide by 1.2. At the 5% reduced rate you divide by 1.05. So a £60 total at 20% is £60 ÷ 1.2 = £50 before VAT, and the VAT is £10.
Why you can't just take off 20%
Taking 20% off £120 gives £96, but the right answer is £100. The 20% was added to the net price, which is the smaller number, so removing it needs division, not subtraction. On a £1,000 invoice the wrong method is out by £33.33, and that error carries into every VAT return or expense claim it touches.
The VAT fraction
HMRC calls the share of a VAT-inclusive price that is VAT the VAT fraction. Multiply the gross price by the fraction and you get the VAT straight away.
| VAT rate | Divide gross by | VAT fraction | VAT in a £100 total |
|---|---|---|---|
| 20% standard | 1.2 | 1/6 | £16.67 |
| 5% reduced | 1.05 | 1/21 | £4.76 |
| 0% zero rate | 1 | none | £0.00 |
Worked examples
| Price incl. VAT | Rate | Before VAT | VAT |
|---|---|---|---|
| £36.00 fuel receipt | 20% | £30.00 | £6.00 |
| £59.99 online order | 20% | £49.99 | £10.00 |
| £250.00 supplier bill | 20% | £208.33 | £41.67 |
| £1,000.00 invoice | 20% | £833.33 | £166.67 |
| £84.00 gas bill | 5% | £80.00 | £4.00 |
Figures are rounded to the nearest penny. The VAT and net always add back up to the original total.
When you need a reverse VAT calculation
- Expense claims: most receipts show one total. If you are VAT registered you can usually reclaim the VAT part on business purchases, so you need to split it out.
- Checking a supplier's invoice: confirm the VAT shown matches the total.
- Setting prices: if you want a shelf price of £24.99 including VAT, this shows what you actually keep before VAT.
- Comparing quotes: put a VAT-inclusive quote and a "plus VAT" quote on the same footing.
Reverse VAT is not the "reverse charge"
The names sound alike but they are different things. This calculator just removes VAT from a price. The VAT reverse charge is an HMRC rule where the customer, not the supplier, accounts for the VAT — for example on some construction services and services bought from overseas. If an invoice says "reverse charge applies", read HMRC's reverse charge guidance rather than using a calculator.
Frequently asked questions
How do I work out VAT backwards at 20%?
Divide the total by 1.2 to get the price before VAT, then subtract that from the total to get the VAT. Or divide the total by 6 to get the VAT straight away.
What is £100 including VAT without VAT?
At 20%, £100 including VAT is £83.33 before VAT, with £16.67 VAT.
Can I reverse VAT at 5%?
Yes. Choose 5% in the rate box. The calculator divides by 1.05, so £105 becomes £100 before VAT and £5 VAT.
Why is my answer a penny out from the receipt?
Shops can round VAT per item or on the whole bill, and both are allowed. If a receipt lists several items, small rounding differences are normal. For a VAT return, use the VAT figure printed on the VAT invoice.