Invoice Generator with PayPal
An invoice with a PayPal.me link that already contains the amount and currency.
Invoice Service Charge Calculator
Work out a service charge, whether it is taxable, and where the money goes.
Quick Tool Overview
The Service Charge Calculator works out the charge, the per-cover share and the distribution to staff, and gets the tax treatment right — which in the UK turns entirely on whether the charge is genuinely discretionary.
- What it does
- Works out a service charge and its tax
- You give it
- The bill, the rate and whether it is optional
- You get back
- The charge, the tax treatment and the per-head share
- Best for
- Restaurants, bars, hotels and caterers
About the Invoice Service Charge Calculator
A service charge is a percentage added to a bill for the service itself, and it raises three questions that have different answers in different places.
Is it taxable? In the UK, a genuinely discretionary service charge is outside the scope of VAT; a compulsory one is standard-rated. That distinction rests entirely on whether the customer can refuse to pay it, which means the wording on the menu and the bill decides the tax treatment.
Does it go to staff? In the UK since October 2024, employers must pass on all qualifying tips and service charges to workers in full and have a written policy. Several US states and EU countries have similar rules. A service charge retained by the business is a price increase, and calling it a service charge does not make it one.
And what does it come to per head? This works out all three: the charge, the tax treatment, the per-cover share, and what each staff member receives under a stated distribution.
Key features of the Invoice Service Charge Calculator
Discretionary or not
The distinction that decides whether VAT applies.
Per-cover share
What each person is contributing, which is what they ask.
Distribution to staff
UK law now requires it to be passed on in full.
Common rates
10%, 12.5% and 15%, with the effect on the total shown.
Wording matters
What the bill says decides the tax treatment, not what you intended.
How to use the Invoice Service Charge Calculator
-
1
Enter the bill
The food and drink total, before the service charge.
-
2
Set the rate
10%, 12.5% and 15% are the common ones.
-
3
Say whether it is discretionary
It decides the tax treatment, so the wording on the bill matters.
-
4
Read the per-head figure
What each cover is contributing, which is what customers actually ask.
-
5
Check the distribution
How it splits across the team under your policy.
Frequently asked questions
In the UK, a genuinely discretionary service charge is outside the scope of VAT; a compulsory one is standard-rated as part of the supply. The test is whether the customer is free not to pay it, which the wording on the menu and the bill determines.
In the UK, since the Employment (Allocation of Tips) Act came into force in October 2024, employers must pass on qualifying tips and service charges to workers in full and maintain a written policy. Rules elsewhere vary but are moving the same way.
Ten to 12.5% in the UK, 10 to 15% across much of Europe, and often not applied at all where tipping is the convention instead. Above 15% it tends to be questioned.
A discretionary one, yes — and if they cannot, it is not discretionary, with the tax consequences that follow. A compulsory charge must be disclosed clearly before the order is taken.
Reviews of the Invoice Service Charge Calculator
What people who use the Invoice Service Charge Calculator think of it. Reviews come from visitors and are posted as written.
No ratings yet
Yours would be the first.
- 5 0 reviews rated 5 stars
- 4 0 reviews rated 4 stars
- 3 0 reviews rated 3 stars
- 2 0 reviews rated 2 stars
- 1 0 reviews rated 1 star
0 reviews
Newest first
No reviews yet
Be the first to rate the Invoice Service Charge Calculator. It takes half a minute and no account.
Write the first reviewMore invoice tools
Invoice Validation Tool
Check an invoice before you send it: required details, arithmetic and what a client can query.
VAT Invoice Generator
A VAT invoice with both VAT numbers, a rate breakdown and reverse-charge wording.
UBL Invoice Generator
Create a valid UBL 2.1 invoice or credit note XML, with the EN 16931 rules checked live.
XML Invoice Generator
Turn an invoice into XML — a plain readable file, UBL 2.1 or CII — from a simple form.
Invoice PDF Merger
Merge invoice PDFs into one file, in the order you choose, without uploading them.
Invoice Tax ID Validator
Check any tax number on an invoice — VAT, GSTIN, ABN, EIN, PAN or IBAN — against its own rule.
Invoice Amount Extractor
Pull the total, subtotal, tax and every other amount out of an invoice.