How to Calculate Service Charge and GST on Restaurant Bills in Singapore

This guide summarises what IRAS publishes for the hotel and food and beverage sector, with worked examples you can check against your own receipts. It is general information, not tax advice. For anything specific to your business, check IRAS or speak to your accountant. We last checked the IRAS pages cited here in September 2026.

The quick answer

A restaurant bill in Singapore is built in three steps:

1. Total the food and drinks, after any item or bill discounts.
2. Add the service charge on that amount. A 10% service charge is typical, but the rate is the business’s decision.
3. Charge GST at 9% on the subtotal including the service charge.

That order comes straight from IRAS. Its Hotel and Food & Beverage page says businesses often add a service charge, “typically at 10%”, that the service charge “is subject to GST as it is part of the total price”, and that GST “should be calculated based on the total price payable (inclusive of service charge)”. The GST rate has been 9% since 1 January 2024, according to IRAS’s current GST rates page.

A quick shortcut: with a 10% service charge and 9% GST, the final bill is the food total multiplied by 1.1 and then by 1.09, which works out to 1.199. That shortcut is fine for a mental check, but your POS should calculate each line separately so the receipt shows the service charge and GST amounts.

Worked examples

Example 1: a $100 bill

This is the same illustration IRAS uses.

Line	Amount
Food and beverage	$100.00
10% service charge	$10.00
Subtotal	$110.00
9% GST (on $110.00)	$9.90
Total	$119.90

Example 2: a 10% discount applied before service charge

IRAS’s page on GST on discounts and rebates says that when you give a discount on the selling price, GST is chargeable on the net discounted price. In this example the restaurant applies its discount to the food first, so the service charge is also calculated on the lower amount.

Line	Amount
Food and beverage	$100.00
Less 10% member discount	-$10.00
Net food and beverage	$90.00
10% service charge (on $90.00)	$9.00
Subtotal	$99.00
9% GST (on $99.00)	$8.91
Total	$107.91

Whether the service charge is worked out before or after a discount is a pricing decision for the restaurant, not a GST rule we found stated by IRAS. What matters for GST is that it is charged on the amount the customer actually pays, including any service charge. Pick one approach, state it in your promotion terms and apply it the same way every time. For vouchers, cash-value gift cards and prepaid packages, the GST treatment has its own rules, so check IRAS before you set them up.

Example 3: service charge waived

Line	Amount
Food and beverage	$100.00
Service charge (waived)	$0.00
9% GST (on $100.00)	$9.00
Total	$109.00

Waiving the service charge removes both the $10 charge and the 90 cents of GST that would have been charged on it.

Example 4: a takeaway item with a GST-inclusive price

If a takeaway item is displayed at $10.90 including GST, the GST inside that price is the tax fraction 9/109 of the price, which is $0.90. IRAS uses the same 9/109 fraction in its price display guidance when working backwards from a GST-inclusive price.

Is GST charged on service charge?

Yes. IRAS is explicit that the service charge is part of the total price for the goods and services provided, so it is subject to GST. Its Displaying and Quoting Prices page repeats the point: GST is charged on both the amount for the service and the service fee imposed by the supplier.

This is the most common error on hand-written or spreadsheet bills, where GST is worked out on the food only and the service charge is added afterwards. On a $100 bill that under-charges GST by 90 cents. It adds up across a month of covers, and the GST you should have collected is still owed to IRAS.

Two related points from IRAS:

• Only GST-registered businesses may charge GST. IRAS’s page on wrongful collection of GST says so directly, and asks businesses that charged GST while unregistered to come forward and return it.
• Registration is compulsory above $1 million of taxable turnover. IRAS’s registration page sets out the retrospective and prospective tests.

Price display rules for GST-registered F&B businesses

The general rule, from IRAS: GST-registered businesses must show GST-inclusive prices on all price displays to the public, including price tags, price lists, advertisements, brochures and websites. Quoted prices, written or verbal, must also be GST-inclusive. Failure to comply can result in a fine of up to $5,000.

F&B has a specific exception. According to the IRAS Hotel and F&B page:

• Hotels and F&B establishments that impose a service charge may display GST-exclusive prices.
• F&B establishments that offer the same items for dine-in and takeaway or delivery, with service charge on dine-in only, may also display GST-exclusive prices, and do not need two price lists.
• In both cases, they must display a prominent statement telling customers that prices are subject to GST and service charge.
• Items sold only for takeaway or delivery and not subject to service charge, such as mooncakes or festive cookies, must be displayed with GST-inclusive prices.

The exception does not apply to F&B businesses that do not impose a service charge, or to those that levy a nominal service charge without genuine business reasons other than avoiding GST-inclusive pricing. They must display GST-inclusive prices.

If you show both prices, IRAS says the GST-inclusive price must be at least as prominent as the GST-exclusive one. It also warns against advertising “no GST” when you are really giving a discount equal to the GST, because GST is still included in the discounted price.

Consumer protection guidance points the same way. The Competition and Consumer Commission of Singapore’s Guidelines on Price Transparency say mandatory charges such as taxes, surcharges and service fees should be included in the headline price, or, where they cannot reasonably be calculated in advance, disclosed clearly and prominently with it. In practice, put the “prices are subject to service charge and GST” statement wherever customers see prices: printed menus, QR ordering pages, kiosks and your online ordering page.

When service charge applies

Whether to charge a service charge, and how much, is a business decision. In its FAQ on refusing to pay service charge, IRAS says it does not interfere with such business decisions, and whether the customer pays depends on the agreement between the customer and the business on the price payable.

Common set-ups we see:

• Dine-in only. Service charge on table orders, none on takeaway or delivery. This is the scenario IRAS names when allowing GST-exclusive display for items sold both ways.
• No service charge at all. Common for hawker stalls, many cafés and counter-service outlets. Menu prices must then be GST-inclusive if you are GST-registered.
• Waivers. Some outlets waive service charge for a complaint, a staff meal or a promotion. Treat a waiver as a permission-controlled action in the POS so you can see who waived what, and when.

If you run self-service QR ordering at the table, think about how customers will see the charge. The disclosure should appear on the ordering screen before the customer confirms, not only on the final bill.

Rounding

IRAS allows two kinds of rounding, per its Invoicing Customers page and F&B page:

• GST to the nearest cent. The total GST may be rounded to two decimal places.
• Bill to the nearest 5 cents. With one-cent coins no longer issued, you may round the total bill to the nearest 5 cents to make cash payment easier. Whether you round up or down is your decision, but it must be applied consistently.

Here is a bill where rounding matters:

Line	Amount
Food and beverage	$38.50
10% service charge	$3.85
Subtotal	$42.35
9% GST (on $42.35 = $3.8115, rounded)	$3.81
Total	$46.16
Rounding (down to nearest 5 cents, if that is your policy)	-$0.01
Amount payable	$46.15

IRAS also notes that GST can be worked out per item and summed, or on the total; both are acceptable if applied consistently, although the two methods can differ by a cent or so. Most restaurant POS systems calculate on the bill total.

Common mistakes

• GST on food only. GST must also be charged on the service charge.
• Charging GST while not registered. Only GST-registered businesses may charge GST.
• Using the old rate. The rate has been 9% since 1 January 2024. Check old menus, receipt templates and spreadsheets.
• GST-exclusive prices with no service charge. The display exception only applies if you genuinely impose a service charge.
• Missing or hidden disclosure. The “subject to GST and service charge” statement must be prominent, including on digital menus.
• Service charge on takeaway by accident. If your policy is dine-in only, make sure the POS switches the charge off for takeaway and delivery orders.
• Inconsistent discount order. Staff applying discounts differently from shift to shift leads to receipts that don’t reconcile.
• Inconsistent rounding. Rounding up on some bills and down on others is not allowed. Pick one.

How a POS should handle it

None of this should be done by hand at the counter. A restaurant POS should let you set the rules once and apply them to every bill:

• Configured once. Service charge rate, GST rate, calculation order, discount order and rounding policy are set in the back office, not typed in by cashiers.
• Applied by order type. Service charge on for dine-in, off for takeaway, delivery and pre-orders, if that is your policy.
• Controlled waivers. Only staff with the right permission can waive service charge or apply a discount, and each action is logged.
• Clear receipts. Each receipt shows the subtotal, service charge, GST and total separately, plus your GST registration number and the other details IRAS requires on a receipt or simplified tax invoice.
• Clean reporting. Daily reports split sales, service charge and GST collected, so your accountant can file the GST return without rebuilding the numbers.

ChaChaCha, powered by AppsPOS, handles table management, split bills and staff permissions at the till, and sends sales data to Xero through our accounting integration. When payments are taken on the same system, through integrated payments such as PayNow, NETS and cards, the collected amounts reconcile automatically against the bill totals. If you want to see how a bill with service charge, a discount and a split payment looks on our receipts, ask us for a demo.

Sources

• IRAS, Hotel and Food & Beverage
• IRAS, Displaying and Quoting Prices
• IRAS, Invoicing Customers
• IRAS, Current GST Rates
• IRAS, GST on Discounts and Rebates
• IRAS, Do I Need to Register for GST
• CCS, Guidelines on Price Transparency