VAT on £120,000
Add or remove VAT at 20%, 5%, 0% on £120,000, with the net, VAT and gross figures.
Adding 20% VAT to £120,000 gives £144,000.00, of which £24,000.00 is VAT. Removing 20% VAT from £120,000 gives £100,000.00 net, with £20,000.00 of VAT inside the price. At the 5% reduced rate the VAT is £6,000.00 when added and £5,714.29 when removed; at 0% nothing changes.
£120,000 at every VAT rate
| Calculation | Net | VAT | Gross |
|---|---|---|---|
| Add 20% | £120,000.00 | £24,000.00 | £144,000.00 |
| Remove 20% | £100,000.00 | £20,000.00 | £120,000.00 |
| Add 5% | £120,000.00 | £6,000.00 | £126,000.00 |
| Remove 5% | £114,285.71 | £5,714.29 | £120,000.00 |
| Add 0% | £120,000.00 | £0.00 | £120,000.00 |
| Remove 0% | £120,000.00 | £0.00 | £120,000.00 |
What £120,000 looks like with and without VAT
£120,000 is contract money: a large order, a vehicle, a fit-out or a year's fees for a single client. Add 20% and the invoice total is £144,000.00, with £24,000.00 of VAT that the customer pays to you and you pay to HMRC on your next return. Because the sums are large, the timing matters: if the invoice date falls just inside a VAT quarter you may owe the £24,000.00 before the customer has paid you, unless you use cash accounting.
Strip the VAT out of £120,000 and you get £100,000.00 net plus £20,000.00 VAT. That is the calculation to use when a supplier quotes an all-in price and you need the net cost for a budget or a capital allowances claim. At the 5% reduced rate the VAT inside £120,000 would be £5,714.29, and at 0% the whole £120,000 is net.
Turnover at this level also puts VAT registration in view. The threshold is £90,000 of taxable turnover in any rolling 12 month period, so £120,000 of sales is already past the point where you must register, and the deregistration limit is £88,000. Once registered you charge 20% on standard-rated sales, which for £120,000 means £24,000.00 on top of your prices, or £20,000.00 absorbed inside them if you cannot raise prices.
Source: GOV.UK: VAT Flat Rate Scheme; GOV.UK: VAT thresholds. Last updated .
Frequently asked questions
- How much is £120,000 plus VAT?
- £120,000 plus 20% VAT is £144,000.00. The VAT element is £24,000.00. At the 5% reduced rate the total is £126,000.00, and at 0% it stays at £120,000.
- How much VAT is included in £120,000?
- If £120,000 already includes 20% VAT, the VAT inside it is £20,000.00 and the net amount is £100,000.00. You divide by 1.2 to find the net, then subtract to find the VAT.
- What is £120,000 minus VAT?
- £120,000 minus 20% VAT is £100,000.00. That assumes the £120,000 was a VAT inclusive price. If £120,000 was already the net price, there is no VAT to take off.
Cite this page: “VAT on £120,000”, SoleKit, https://solekit.co.uk/vat-calculator/120000