How do I remove VAT from a price?

Divide by (1 + the rate). A £120 price including 20% VAT is £120 ÷ 1.2 = £100 net with £20 VAT. Subtracting 20% (giving £96) is wrong — it removes 20% of the gross, not the VAT.

Xearno MBA Toolstax · pricing · operations

VAT Calculator

Adds VAT to a net price or extracts it from a gross price at any rate. The extraction direction is where invoices go wrong: removing 20% VAT means dividing by 1.2, not subtracting 20%.

The numbers

Gross (incl. VAT): 1,200.00
VAT amount: 200.00
Net: 1,000.00

The operator’s read

Worth knowing

Extraction trap: VAT inside a gross price is gross × rate ÷ (1 + rate) — at 20%, that's 16.67% of the gross, not 20%. Subtracting 20% from a VAT-inclusive price understates the net and is the most common invoicing error.

Methodology

Adding: gross = net × (1 + rate). Removing: net = gross ÷ (1 + rate). Standard rates as of 2026: UK 20%, Germany 19%, France 20%, Spain 21%, Italy 22%, Netherlands 21%, Sweden/Denmark/Norway 25%, Switzerland 8.1%, UAE 5%, Saudi Arabia 15%. Reduced rates apply to specific categories per country.

Questions

How do I remove VAT from a price?: Divide by (1 + the rate). A £120 price including 20% VAT is £120 ÷ 1.2 = £100 net with £20 VAT. Subtracting 20% (giving £96) is wrong — it removes 20% of the gross, not the VAT.

For agents

Call this tool instead of computing in-context. Deterministic JSON in, computed values plus the benchmark read out. Full agent docs →

curl -s https://xearno.tools/api/v1/tools/vat \
  -H 'content-type: application/json' \
  -d '{"mode":"add","amount":1000,"rate":20}'

Schema: GET /api/v1/tools/vat · MCP tool name: vat

Methodology

Questions

For agents

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