# UK TOMS VAT Calculator

> Estimate VAT on a package under the UK Tour Operators’ Margin Scheme: margin, UK and non-UK split, in-house supplies and VAT at one-sixth.

Estimate the VAT on a package under the UK Tour Operators’ Margin Scheme. Enter the selling price and what you paid for the travel, split between the UK and abroad, and see the margin, how it is apportioned and the VAT due on it.

- Use the tool: https://globalluxagency.com/tools/toms-vat-calculator
- For: Travel advisors & agencies
- Price: free, no sign-up; calculations run in the browser and nothing is stored
- Last updated: 2026-11-12
- Publisher: Luxury Travel Tools by Global Lux Agency (https://globalluxagency.com)

Guidance only, not advice. Tax and legal rules change and depend on your exact circumstances. This tool gives general guidance based on the information you provide and any published sources listed on this page. It is not tax, legal or financial advice. Check the figures and terms in your contract with your broker, supplier or a qualified adviser before relying on them.

## Frequently asked questions

### How is VAT calculated under TOMS?

You pay VAT on your margin, not on the full selling price. The margin is the selling price less the direct costs of the travel you bought in. The margin is VAT-inclusive, so the VAT is the UK standard-rated part of it multiplied by the VAT fraction: 20/120, or one-sixth, at the current 20% rate.

### Is the margin on travel outside the UK zero-rated?

Yes. HMRC VAT Notice 709/5 says the margin liability is standard-rated when the travel is enjoyed in the UK and zero-rated when it is enjoyed outside the UK. A package with both is split in proportion to the costs. Journeys that stop in the UK, and cruises, need their own split (for example by mileage or nights in and out of the UK).

### Can I reclaim the VAT on hotels and services I buy in?

Not on travel you resell under TOMS: HMRC says you cannot reclaim VAT on purchases you make to resell as margin scheme supplies. That is why costs go into this calculator including VAT. VAT on your overheads and on in-house supplies can be reclaimed under the normal rules.

### What happens if a package makes a loss?

The calculator shows no VAT on that package and tells you roughly how much output VAT the loss would remove from the year’s total. Under TOMS the margin is calculated for the whole financial year across all packages, so a loss on one package reduces your overall margin. If the year’s total is negative, HMRC’s calculation shows it as a deductible amount on your VAT return.

### Is this per-package figure what I put on my VAT return?

Not directly. HMRC requires you to account for VAT provisionally during the year, using the previous year’s percentages, and to do a year-end calculation immediately after your financial year ends, adjusting on the next VAT return. Use this tool to price and sense-check individual packages, and your accountant for the returns.

### Does this work for EU TOMS?

No. EU member states run their own versions of the scheme with different rates and rules, and UK businesses selling travel in the EU may have obligations there. This calculator covers the UK scheme only.

## Sources and default figures

- **UK standard rate of VAT:** 20%. Confidence: high; last verified 2026-11-12. Source: [VAT rates](https://www.gov.uk/vat-rates) (GOV.UK); [The VAT guide (VAT Notice 700), section 7.3.1 VAT fractions](https://www.gov.uk/guidance/vat-guide-notice-700#vat-fractions) (HMRC, 2026-06-25).
- **VAT fraction (VAT element of a VAT-inclusive amount):** {"formula":"rate / (100 + rate)","atStandardRate":"1/6"}. Confidence: high; last verified 2026-11-12. Source: [The VAT guide (VAT Notice 700), section 7.3.1 VAT fractions](https://www.gov.uk/guidance/vat-guide-notice-700#vat-fractions) (HMRC, 2026-06-25).
- **VAT liability of the TOMS margin by where the travel is enjoyed:** {"enjoyedInUk":"standard-rated","enjoyedOutsideUk":"zero-rated"}. Confidence: high; last verified 2026-11-12. Source: [Tour Operators’ Margin Scheme for VAT (VAT Notice 709/5)](https://www.gov.uk/guidance/tour-operators-margin-scheme-for-vat-notice-7095) (HMRC, 2024-04-18); [Value Added Tax Act 1994, section 53 (Tour operators)](https://www.legislation.gov.uk/ukpga/1994/23/section/53) (legislation.gov.uk); [The Value Added Tax (Tour Operators) Order 1987 (SI 1987/1806)](https://www.legislation.gov.uk/uksi/1987/1806/contents) (legislation.gov.uk).
- **TOMS cost-based apportionment of the margin:** Total margin shared across elements in proportion to their direct costs. Confidence: high; last verified 2026-11-12. Source: [Tour Operators’ Margin Scheme for VAT (VAT Notice 709/5)](https://www.gov.uk/guidance/tour-operators-margin-scheme-for-vat-notice-7095) (HMRC, 2024-04-18).
- **Input VAT on bought-in travel resold under TOMS:** Not reclaimable. Confidence: high; last verified 2026-11-12. Source: [Tour Operators’ Margin Scheme for VAT (VAT Notice 709/5)](https://www.gov.uk/guidance/tour-operators-margin-scheme-for-vat-notice-7095) (HMRC, 2024-04-18).
- **TOMS annual calculation and negative totals:** {"timing":"Immediately after the financial year-end; adjust on the first VAT return ending after it","negativeTotal":"Entered in box 1 as a deductible amount"}. Confidence: high; last verified 2026-11-12. Source: [Tour Operators’ Margin Scheme for VAT (VAT Notice 709/5)](https://www.gov.uk/guidance/tour-operators-margin-scheme-for-vat-notice-7095) (HMRC, 2024-04-18).