Bahamas bill and tip calculator: VAT, service charge and split

How the planner works

Everything is built on the net price: the food and drink before VAT.

1. Net price. If the menu prices did not include VAT, the subtotal you enter is the net price. If you tick "VAT already included in prices", the calculator takes the VAT back out by dividing the subtotal by 1.10 (one plus the VAT rate).
2. Service charge. The service percentage, 15 per cent by default, is applied to the net price.
3. VAT. The VAT rate, 10 per cent unless you change it, applied to the net price. If you tick "VAT also charged on the service charge", it becomes 10 per cent of the net price and the service charge together.
4. Extra tip. Any extra percentage is also worked out on the net price, not on a total that includes tax.
5. Total and split. The four amounts are added up and divided by the number of people, rounded to the cent.

net        = subtotal              (or subtotal ÷ 1.10 if VAT is included)
service    = net × service %
VAT        = net × 10 %            (or (net + service) × 10 %)
extra tip  = net × extra tip %
total      = net + service + VAT + extra tip
each       = total ÷ people

Worked example

The calculator opens with $80 of food and drink for two people. VAT is not included in the menu prices, the service charge is 15 per cent, VAT is not charged on the service charge and there is no extra tip.

• Net price: $80.00
• Service charge: $80 × 15 per cent = $12.00
• VAT: $80 × 10 per cent = $8.00
• Total: $80 + $12 + $8 = $100.00, or $50.00 each

Three changes show how much the boxes matter. Tick "VAT also charged on the service charge" and the VAT becomes 10 per cent of $92, which is $9.20, so the bill rises to $101.20, or $50.60 each. Leave that box clear but add a 5 per cent extra tip and you pay $4 more, $104 in all and $52 each. If instead the $80 on the menu already included VAT, the net price drops to $72.73, the service charge to $10.91 and the VAT to $7.27, for a total of $90.91, or $45.45 each.

Why two bills for the same meal differ

Menu prices. A Department of Inland Revenue rule allows sit-down restaurants and hotel restaurants with table service to print menu prices without VAT, provided the menu also states the VAT rate that will be added. Takeaway and counter-service outlets fall outside that rule. So the same $80 can mean $80 plus tax in one place and $80 including tax in another.

The automatic service charge. Many sit-down restaurants and hotels add a gratuity to the bill, and 15 per cent is the figure the calculator starts with. If it is on the bill, the tip is already included. Check the bill before you add more, as our Arawak Cay Fish Fry guide also advises.

VAT on the gratuity. Under a second rule, a mandatory gratuity escapes VAT only if it is listed on the bill, paid in full into a pool shared only among the staff directly involved in serving you, and not reduced by any deduction other than National Insurance contributions. Where those conditions are not met, VAT can be charged on the service charge as well. You cannot see a restaurant's payroll from your table, but you can see the bill: if the VAT line is 10 per cent of the food and the service charge together, tick the box.

What it can't tell you

What is already on your bill. The calculator only knows what you enter. If you are unsure whether service has been added, ask.

Small rounding gaps. Tills sometimes round VAT line by line, so a printed bill can differ from the calculator by a cent or two.

What you should tip. Tipping is your decision. Where no service charge has been added, set the service box to 0 and put your own tip in the extra tip box.

Rate changes. The calculator applies one VAT rate to the whole bill. If the rate changes, enter the new figure. For more on eating out, see our food and drink section.

Sources

• Department of Inland Revenue: About VAT
• VAT Rule 2015-013: Menu pricing for dine-in establishments (PDF)
• VAT Rule 2015-022: Treatment of mandatory gratuities (PDF)

Frequently asked questions

What is the VAT rate on a restaurant bill in the Bahamas?

The standard rate of VAT in the Bahamas is 10 per cent, and the calculator uses it by default. Sit-down restaurants may leave it out of menu prices and add it at the end, as long as the menu says so. Check the menu or the bill to see which way your restaurant does it.

Is the service charge the same as a tip?

A service charge, often listed as a gratuity on Bahamian bills, is a tip the restaurant adds for you. If it appears on the bill you do not need to tip again, though you can add more for very good service. If there is no service charge, any tip is up to you.

Can I pay a Bahamian bill in US dollars?

Yes. The Bahamian dollar is held at par with the US dollar, and both are accepted throughout the islands. The calculator's figures read the same in either currency.