What is VAT?
Value Added Tax (VAT) is an indirect tax charged on goods and services at each stage of sale and ultimately paid by the consumer. Business owners, accountants and freelancers calculate it constantly when preparing invoices and quotes, and shoppers need it to understand the real price.
Two ways to calculate
Adding VAT to a net price
VAT = amount × rate and gross = amount × (1 + rate). Example: a £1,000 service at 20% VAT has £200 tax and a £1,200 gross total.
Removing VAT from a gross price
net = gross ÷ (1 + rate). Example: an invoice of 1,150 SAR including 15% VAT has a net of 1,150 ÷ 1.15 = 1,000 SAR and 150 SAR VAT.
Common mistake: to extract 15% VAT from a gross amount, don't multiply by 15% — that gives 172.5 instead of 150. You must divide by 1.15, which is what the calculator does.
Standard VAT rates in some countries
| Country | Standard rate |
|---|---|
| United Kingdom | 20% |
| France | 20% |
| Morocco | 20% (reduced 7%, 10%, 14%) |
| Saudi Arabia | 15% |
| Egypt | 14% |
| Bahrain | 10% |
| UAE | 5% |
Rates are for guidance and can change; always confirm the rate that applies to your business with your local tax authority.
Tips for businesses
- Show net amount, VAT and gross total separately on invoices.
- Write the total in words with the Number to Words tool.
- Round VAT to two decimals according to your local accounting rules.
Frequently Asked Questions
How do I calculate 20% VAT?
Multiply the net amount by 0.20 for the VAT, or by 1.20 for the gross total.
How do I find the price before VAT?
Choose “Remove VAT”, enter the gross amount and the rate — or divide the gross by (1 + rate).
Is VAT the same as sales tax?
Both are consumption taxes, but VAT is collected at every stage of the supply chain while US sales tax is charged only at the final sale.
Can I use a custom rate?
Yes. Type any rate in the VAT rate field.
Is my data stored?
No. All calculations happen in your browser.
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