United Kingdom VAT Rate 2026: 20% Standard Rate

How Much Is VAT in United Kingdom?

The standard VAT rate in United Kingdom is 20% in 2026, plus reduced rate of 5% on certain goods and services. It applies to most goods and services sold in United Kingdom. Standard VAT/GST rates worldwide range from around 5% to 27%.

How to calculate United Kingdom VAT

To add 20% VAT to a net (tax-exclusive) price, multiply it by 1.2. To remove VAT from a gross (tax-inclusive) price, divide it by 1.2.

• Add VAT: GBP 100 net × 1.2 = GBP 120 gross (that is GBP 20 of VAT)
• Remove VAT: GBP 120 gross ÷ 1.2 = GBP 100 net (that is GBP 20 of VAT)

Use the United Kingdom VAT calculator above for any amount, or compare United Kingdom with every other country in our VAT rates by country table.

Current VAT Rates

Historical VAT Rate Changes

• 2025: Current standard rate (no change)
• 2011: Rate increased from 17.5% to 20%
• 2010: Rate restored from temporary reduction
• 2008: Temporary reduction during financial crisis
• 1991: Rate increased from 15%
• 1973: VAT introduced replacing Purchase Tax

Economic Impact

VAT contributes approximately 20-30% to United Kingdom's total tax revenue. The current rate structure balances revenue generation with economic competitiveness within the Europe region.

Zero-Rated Items

The following items are zero-rated for VAT in United Kingdom:

• Exports of goods and services
• International transportation
• Some basic food items
• Children's clothing
• Books and newspapers
• Prescription medications

VAT Exempt Items

The following are exempt from VAT in United Kingdom (no VAT charged, no input VAT recovery):

• Financial services
• Insurance services
• Healthcare and medical services
• Education and training
• Postal services
• Charitable activities

Reduced Rate Applications

Items subject to reduced VAT rates in United Kingdom:

• 5% rate: Domestic fuel and power, children's car seats, energy-saving materials and mobility aids

The UK requires VAT registration once taxable turnover exceeds £90,000 in any rolling 12-month period. Always confirm current thresholds and deadlines with HM Revenue & Customs (HMRC), as they are reviewed periodically.

VAT Registration

• Registration Threshold: £90,000
• Voluntary Registration: Available below threshold
• Registration Process: Online via tax authority website
• Processing Time: Typically 2-4 weeks

VAT Returns and Payment

• Filing Frequency: Quarterly, under Making Tax Digital
• Filing Deadline: End of month following period
• Payment Methods: Bank transfer, online payment
• Late Filing Penalties: Varies by amount and delay

Cross-Border Trade

Special considerations for international transactions:

• Intra-EU Trade: Not applicable (non-EU country)
• Imports: VAT payable at point of entry
• Exports: Generally zero-rated
• Digital Services: Special rules may apply

For background on how the buyer accounts for VAT on intra-EU and cross-border B2B supplies, see the reverse charge mechanism. For B2C digital sales and low-value imports, see VAT on digital services and cross-border e-commerce.

Nearby Countries

What is the current VAT rate in United Kingdom?

The standard VAT rate in United Kingdom is 20% as of 2026. This applies to most goods and services unless they qualify for reduced rates or exemptions.

How do I calculate VAT in United Kingdom?

To add VAT: multiply the net amount by 20%. To remove VAT from a gross amount: divide by 1.20. Use our calculator above for instant results.

Who needs to register for VAT in United Kingdom?

The UK requires VAT registration once taxable turnover exceeds £90,000 in any rolling 12-month period.

Can I reclaim VAT in United Kingdom?

VAT-registered businesses can generally reclaim input VAT on business purchases. Non-EU tourists may claim VAT refunds on qualifying purchases when leaving the country — see our guide to VAT refunds for tourists and non-resident businesses.