VAT Inclusive vs VAT Exclusive
Understand the difference between VAT-inclusive (gross) and VAT-exclusive (net) prices. Use the calculator below to convert between them in either direction.
VAT-exclusive (net) price
The price before VAT is added. Also called ex-VAT or net. Used on B2B invoices as the base amount.
Example: £100 net
VAT-inclusive (gross) price
The price including VAT. Also called inc. VAT or gross. Used in consumer/retail pricing.
Example: £120 gross (= £100 + £20 VAT)
Add or remove UK VAT at 20%, 5%, or zero rate — instantly shows net, VAT amount, and gross total.
After calculating, copy the result into your workflow instead of searching for the calculator again.
Calculate first, then reuse the result
After you calculate, UtilityPilot can turn the result into a clean note you can paste into your SOP, spreadsheet, CRM, Slack, Notion, checklist or email.
Plain-English result — paste into any tool
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Formula
Add VAT: Gross = Net × (1 + Rate ÷ 100)\nRemove VAT: Net = Gross ÷ (1 + Rate ÷ 100)
At 20%: Net × 1.20 = Gross; Gross ÷ 1.20 = Net. At 5%: Net × 1.05 = Gross; Gross ÷ 1.05 = Net. The VAT amount is always the difference between gross and net.
Worked Example
What is 100 plus VAT?
£100 net × 20% = £20.00 VAT → £120.00 gross
What is 165 plus VAT?
£165 net × 20% = £33.00 VAT → £198.00 gross
Adding VAT — B2B invoice:
A marketing agency quotes a client £4,500 net. The invoice must show the VAT-inclusive total.
£4,500 × 20% = £900.00 VAT → £5,400.00 gross
Removing VAT — retail receipt:
A business receipt shows £84.00 including 20% VAT. What is the net?
£84 ÷ 1.20 = £70.00 net • VAT = £14.00
Reduced rate (5%) — domestic energy:
A quarterly gas bill of £230 includes 5% VAT.
£230 ÷ 1.05 = £219.05 net • VAT (5%) = £10.95
Common Mistakes
- Subtracting 20% to remove VAT. £120 − 20% = £96, not £100. The correct method is £120 ÷ 1.20 = £100.
- Adding VAT twice. If a price is already VAT-inclusive, do not add VAT again. Use "Remove VAT" to verify first.
- Applying the wrong rate. Some goods qualify for the 5% reduced rate (domestic fuel, children's car seats) or 0% (most food, books).
Guide
How to Use
- 1
Select Add or Remove VAT
"Add VAT" for a net price that needs a gross total. "Remove VAT" to extract the net from a VAT-inclusive price.
- 2
Enter the amount
Type the price in pounds. The label shows which type you are entering.
- 3
Select the VAT rate
UK standard is 20%. Choose 5% for reduced rate goods, 0% for zero-rated, or enter a custom rate.
- 4
Review all three figures
Net, VAT amount, and gross are shown together. Copy them for invoices or records.
Next Steps
What to do next
FAQ
Frequently Asked Questions
Related by Workflow
Related by Region
Key differences
| Feature | VAT-exclusive (net) | VAT-inclusive (gross) |
|---|---|---|
| Also called | Net, ex-VAT, ex-tax | Gross, inc. VAT, with VAT |
| VAT included? | No | Yes |
| Used for | B2B invoices, wholesale | Consumer/retail pricing |
| 20% VAT example | £100 | £120 |
| Convert to other | × 1.20 to get gross | ÷ 1.20 to get net |
Worked example at 20%
Starting from the net (ex-VAT) price:
£100 (net) × 1.20 = £120 (gross) · VAT = £20
Starting from the gross (inc-VAT) price:
£120 (gross) ÷ 1.20 = £100 (net) · VAT = £20
Use this in your workflow
After calculating, copy the net/VAT/gross breakdown into your invoice template, bookkeeping spreadsheet, CRM, Slack, Notion or expense claim using the Copy result summary button.