Adding and removing VAT
To add VAT, multiply the net price by 1 + rate. To remove VAT, divide the gross price by 1 + rate. Removing 20% VAT is therefore not the same as taking 20% off the gross total.
A simple check
At 20%, a £100 net price becomes £120 gross. Starting with £120 gross and removing VAT returns £100 net and £20 VAT. This is arithmetic, not a determination of the tax treatment of your supply.
Use the correct classification
HMRC lists standard, reduced and zero rates. Exemption is a different classification from zero rating. Check the rules for the specific goods or service rather than choosing a rate because it produces the expected total.
Common questions
How do I avoid counting VAT twice?
If a quote already includes VAT, select remove to inspect its net amount; do not add another 20%.
Sources & methodology
- GOV.UK: VAT rates
Standard rate 20%, reduced rate 5%, zero rate 0%; eligibility depends on the supply.
Checked 8 Oct 2026