Answers · UK 2025/26
How much VAT do I pay on £100,000 of turnover in 2026/27?
If £100,000 is your net (VAT-exclusive) standard-rated sales, you charge customers £20,000 of VAT at 20% and pass it to HMRC after deducting input VAT on purchases. If £100,000 already includes VAT, the VAT element is £16,667 and your net sales are £83,333.
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How much VAT you pay on £100,000 of turnover depends on whether that figure is VAT-exclusive (net) or VAT-inclusive (gross), and on how much input VAT you can reclaim. If £100,000 is your net standard-rated turnover, you add 20% VAT on top, charging customers £20,000 in output VAT and collecting £120,000 in total. If the £100,000 already includes VAT, divide by 1.2 to get net sales of £83,333 and a VAT element of £16,667. Crucially, VAT is not simply a cost to you: you pay HMRC the output VAT you charge minus the input VAT you incur on business purchases. So if you charged £20,000 of output VAT and paid £4,000 of VAT on stock, equipment and overheads, your net VAT bill to HMRC is £16,000. Businesses on the Flat Rate Scheme instead pay a fixed percentage of gross turnover, which varies by trade sector, and generally cannot reclaim input VAT except on certain capital assets over £2,000. Not all sales carry 20% VAT: some goods and services are zero-rated (such as most food and children's clothing), reduced-rated at 5% (such as domestic fuel), or exempt (such as some financial services), and these change the calculation. You report and pay VAT through quarterly returns under Making Tax Digital, with payment normally due one month and seven days after the quarter ends. Use the VAT calculator to convert between net, VAT and gross figures for any turnover.
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This answer is informational only and does not constitute financial, tax or legal advice. Figures are for the 2025/26 UK tax year. See our methodology and sources.