What's the difference between VAT and sales tax?

VAT is charged at each stage of production and is included in the price shown to consumers in most countries that use it. Sales tax (used in the US) is typically added only at the final point of sale.

VAT Calculator

Add VAT to a net price, or work backward from a VAT-inclusive price to find the net amount and VAT charged.

Mode

Net amount

VAT rate

Gross amount (incl. VAT)

$120.00

VAT amount$20.00

What Your Result Means

In "Add VAT" mode, the gross amount is the final price a customer pays, including tax. In "Remove VAT" mode, the net amount is the pre-tax price, useful for bookkeeping when you only have a VAT-inclusive receipt total.

How It Is Calculated

Gross = Net × (1 + VAT Rate / 100)

Net = Gross / (1 + VAT Rate / 100)

Worked Example

A net amount of £100 with 20% VAT has a gross price of £120. Conversely, a £120 gross price with 20% VAT implies a £100 net amount.

Important Assumptions

Uses the VAT rate you enter - actual rates vary by country and product/service category.

Frequently Asked Questions

What's the difference between VAT and sales tax?: VAT is charged at each stage of production and is included in the price shown to consumers in most countries that use it. Sales tax (used in the US) is typically added only at the final point of sale.

Related Calculators

Sales Tax Calculator

Calculate sales tax on a purchase, or back out the pre-tax price from a total.

Discount Calculator

Calculate the final price and savings after one or two discounts.

Markup Calculator

Calculate markup, selling price, and profit per unit from cost.

Methodology

This calculator uses standard VAT percentage math. See our methodology page for details.

This calculator provides estimates for educational purposes only. Actual rates, taxes, insurance, fees, and lender terms may differ. It does not constitute financial advice - consult a qualified financial professional before making financial decisions.