How a restaurant bill is calculated in India
- Subtotal: the menu prices of everything you ordered.
- Discount: comes off before tax, so you pay less tax too.
- Service charge: a percentage of the (discounted) bill, drinks included, if the restaurant adds one.
- GST: on food and the service charge. 5% for most restaurants, shown as 2.5% CGST + 2.5% SGST.
- VAT on alcohol: alcohol is outside GST, so the state charges VAT instead. The rate varies by state.
- Tip: on top, and not taxed.
Example for 4 people: ₹2,400 food with 5% GST and 10% service charge → ₹240 service + ₹132 GST (5% of ₹2,640) = ₹2,772, or ₹693 each.
Is service charge compulsory?
No. Under the Central Consumer Protection Authority's 2022 guidelines, a restaurant can't add a service charge by default or make it a condition of service. You can ask for it to be removed from the bill. If you do pay it, GST is charged on it as part of the bill.
Splitting equally vs. by what people had
An equal split is quick, but it's unfair when one person had a ₹1,400 pitcher of beer and another had a ₹160 lime soda. A fair itemised split gives each person:
- the items they had (shared items divided among the people who shared them),
- plus the tax on their items. Beer carries VAT, food carries GST, and the rates differ,
- plus their part of the service charge, and an equal slice of the tip.
Doodle Bill does exactly this. Tap the people on each item, and it gives a per-person total that adds up to the exact bill, plus who owes whom. You can send the result to the group as a link, with no app to install and no account.
Questions
Why doesn't the split come out exactly even?
Money can't be split into less than a paisa. When the total doesn't divide evenly, the leftover paise go to one person each, so the shares still add up to the exact bill.
Is GST charged on the tip?
No. A voluntary tip isn't part of the taxable bill.
What VAT rate applies to alcohol?
It's set by each state and changes over time, so use the rate printed on your bill. This calculator defaults to 20% as a placeholder.