What is a service charge?A service charge is an amount a restaurant adds to your bill before handing it to you. What it is, what it isn't, and why it's not the same as a tip.Do you have to pay it?If a service charge is genuinely discretionary, you can ask for it to be removed. Where that comes from, when it doesn't apply, and how to actually say it.Optional, discretionary or mandatory?The three words restaurants use for a service charge, what each one commits you to, and how to work out which you're looking at before the bill arrives.Where does the money go?Since October 2024, UK employers must pass on 100% of tips and service charges to staff. What that law requires, what it doesn't, and what's changing.What the law saysThere's no law setting service charges — but there are rules about disclosing them. How the DMCC Act's price transparency regime applies, and where it leaves a genuine grey area.How much is it, usually?12.5% is the figure you'll meet most often in London, with 15% appearing at some venues. There is no official statistic and no legal rate — here's what's actually known.VAT on service chargesA compulsory service charge follows the VAT liability of the meal — standard-rated in a restaurant. A genuinely discretionary one is outside the scope of VAT entirely.