What are Service Fees?

A service fee is an extra charge added to your bill at a restaurant, separate from your food and drinks. You'll usually see it as a percentage, somewhere between 3% and 20%, added automatically before tax.

People often mix this up with a tip, but they're not the same thing. A tip is something you choose to leave, and it usually goes right to your server. A service fee is not optional; it's already added to your bill no matter what you decide. And where that money actually goes depends on the restaurant itself.

Some places use it to pay staff better, especially back-of-house staff who don't usually get tipped directly. Others use it to deal with rising food costs or card processing fees without having to raise their menu prices. And some restaurants just keep it as extra revenue for the business.

Since these fees have become a lot more common over the last few years, especially after the COVID-19 pandemic, people get confused about what they're actually paying for. It's totally fine to just ask the staff what the fee covers; most of them will explain it to you.