UK VAT calculator.
With business expense recovery.

To add VAT: multiply the net amount by (1 + VAT rate). For standard rate 20%: net £100 × 1.20 = gross £120. The VAT element is £20. To remove VAT from a gross amount: divide by (1 + VAT rate). £120 ÷ 1.20 = net £100; the VAT element is £20. For the reduced rate (5%): add: net × 1.05; remove: gross ÷ 1.05. Zero-rated (0%) has no VAT element — the net and gross amounts are identical.

The UK VAT registration threshold is £90,000 since 1 April 2024 (increased from £85,000). Any business whose taxable turnover exceeds £90,000 in a rolling 12-month period must register for VAT within 30 days. You can also voluntarily register below this threshold, which makes sense if your customers are VAT-registered businesses (so they can reclaim the VAT you charge) or if you have significant input VAT to recover.

Yes, VAT-registered businesses can reclaim input VAT on expenses that are wholly for business purposes. You need a valid VAT invoice for purchases of £25 or more. Key conditions: the supplier must be VAT-registered, the expense must be for business purposes, you must hold a valid VAT invoice, and the VAT must not be blocked by HMRC rules. Blocked items include business entertainment (meals, hospitality), most car purchases with private use, and some accommodation costs.

HMRC specifically blocks VAT recovery on certain categories even when fully business-related. The main blocked categories are: business entertainment and hospitality (client meals, corporate events, staff parties beyond trivial amounts), cars with any private use element, and some motorbikes with private use. These blocking orders are set out in SI 1992/3222. Staff subsistence (employee meals while travelling for work) is NOT blocked — it is reclaimable with a valid VAT invoice. The calculator flags non-recoverable categories automatically.

This is one of the most important distinctions in UK VAT. Zero-rated supplies (0%): VAT applies at 0%, but the supply is still "VATable" — you must be VAT-registered to make these supplies, and you can reclaim input VAT on related costs. Examples: most food, children's clothing, books, newspapers, passenger transport, drugs dispensed on prescription. Exempt supplies: VAT does not apply at all. You cannot charge VAT, but you also cannot recover input VAT on costs related to exempt supplies. Examples: financial services, insurance, education, healthcare, letting of residential property.

For purchases of £25 or more (inc. VAT), you need a full VAT invoice containing: supplier name and address, supplier VAT registration number, invoice date, invoice number, description of goods or services, unit price (if applicable), rate of VAT, net amount, VAT amount, and gross amount. For purchases under £25, a simplified invoice (till receipt showing the VAT rate applied) is sufficient. For purchases under £250, a modified invoice showing less detail is acceptable. These rules are in HMRC Notice 700, paragraph 19.4.

Making Tax Digital (MTD) for VAT is HMRC's initiative to move VAT record-keeping and submissions to digital platforms. MTD for VAT became mandatory for all VAT-registered businesses in April 2022. Requirements: keep digital VAT records, submit VAT returns via MTD-compatible software, and maintain a "digital link" between records and submissions (no manual re-keying of figures). HMRC has approved numerous software providers. Penalties for non-compliance are points-based: accumulate enough points and receive a £200 fine per return missed.

UK VAT numbers have the format: GB followed by 9 digits (e.g., GB123456789) for standard registrations, or GB followed by 12 digits for branch traders (e.g., GB123456789012). You can verify a UK VAT number at GOV.UK's VAT number checker, or via the HMRC API. After Brexit, GB VAT numbers are no longer valid in the EU VIES system. EU suppliers selling to UK businesses use their EU VAT number; UK businesses may need a separate EU VAT registration depending on the nature of supplies.