GST and service charge on restaurant bills in Singapore

Before you read

This guide is general information, not tax advice. Each rule links to the IRAS page it comes from, with the day we read it. Check your own situation with your accountant or IRAS before you change your prices.

The rate

The current GST rate in Singapore is 9%.^[1]

Prices must include GST — with one exception

IRAS's rule for showing prices is clear: a GST-registered business must display and quote prices to the public inclusive of GST — on price tags and price lists, advertisements and brochures, website prices, and written or verbal quotes — and not doing so may result in a fine of up to $5,000.^[2]

There is one exception that matters to restaurants. Hotels and F&B establishments that impose a service charge may show prices before GST, with a prominent statement such as “Prices are subject to GST and service charge”; this does not apply to those with no service charge, or to F&B establishments that levy a nominal service charge without genuine business reasons.^[3]

That is where the familiar "++" comes from: a menu price followed by "++" means service charge and GST will be added. Without a service charge, a restaurant shows the price the guest pays.

How a "++" bill adds up

GST is charged on the service charge too. IRAS's own example: on $100 of food and drink, a 10% service charge adds $10, and 9% GST on the $110 is $9.90, for a total of $119.90.^[4]

So the order on the bill is:

1. the food and drink;
2. the service charge, on the food and drink;
3. GST, on both together;
4. the total.

A common mistake is to work GST out on the food only and add the service charge afterwards. That under-charges GST on the service charge — IRAS's example shows the GST on the full $110.

Which way suits you

Both ways are allowed if you follow the conditions:

• Prices including GST, no service charge. The menu price is what the guest pays. Simple for counters, cafés, hawker-style and quick service.
• Prices before GST, with a service charge ("++"). You must take a genuine service charge and show the statement prominently on the menu.

Whichever you choose, your menu and your POS must agree. A "++" menu with a POS that includes GST in prices — or the other way round — gives guests a different total from the one they expected.

What the guest sees

On a "++" bill the guest sees the dishes at menu prices, then the service charge, then GST, then a total that is higher than the menu prices added up. On a bill with prices including GST, the total is the menu prices added up, and the GST inside it is shown for information. Either is fine — what upsets guests is a bill that doesn't match what the menu led them to expect. Train staff to explain the two lines in one sentence.

Service charge and staff

How a service charge is shared with your staff is not something the IRAS pages above cover. Whatever you agree with your team, write it down and keep it consistent. For how other countries treat service charges and tips, see our guide to service charges and tips.

Setting it up in BillDine

What BillDine does for a restaurant in Singapore today:

• GST ready. In quick start, tick that your business is registered for GST, type your GST registration number and keep the usual rates ticked: BillDine adds GST 9%. Tick Add a 10% service charge on dine-in bills if you take one.
• Prices including GST, or "++". A new Singapore outlet includes GST in prices. One that takes the service charge in quick start starts with prices before GST ("++"), and one that adds a percentage service charge later, before its first sale, is asked Switch to ++ or Keep prices including GST.
• The statement on the bill. "++" bills say Prices are subject to 10% service charge and 9% GST. Put the same line on your printed menu.
• GST on the service charge. The ready-made service charge is taxed, so the bill works out GST on the food and the service charge together, as in IRAS's example.
• Taking the charge off. Staff can remove the service charge from a single bill on the POS, and waiters may do so.
• Cash rounding. A new outlet in Singapore rounds cash payments to 0.05, while a card pays the exact total. The rounding shows as its own line, and GST is never rounded away.
• PayNow. PayNow is ready as a payment method, recorded like cash but not counted in the cash drawer.
• For your return. The tax report shows GST by rate for any period, with the service charge's GST included; every report exports as CSV or PDF. See reports.

A short checklist

1. Decide: prices including GST, or "++" with a genuine service charge.
2. If "++", print "Prices are subject to GST and service charge" prominently on the menu.
3. Check that GST is worked out on the service charge as well as the food.
4. Make your POS's tax mode match your menu.
5. Print a test bill and add it up by hand once.