Tipping is not quite obligatory in North America. However, because the waitstaff are often paid fairly low wages, it is the customary practice. In many other countries with stiff minimum wage requirements, particularly the UK, Australia, and New Zealand, tipping is not customary: it is entirely optional, a reward for extraordinarily good service, and the customer need not feel obliged to tip. In some countries, such as Japan, tipping can actually be considered an insult both to the server ("You need this more than I do.") AND the owner of the establishment ("You don't pay your staff decently.")
If you used any coupons or discounts, calculate the tip based on how much you would've paid without it. Otherwise, you're punishing the waiter for the restaurant management's efforts to bring you in the door. For example, if you have a 2-for-1 coupon, you may only have had to pay for half of your meal, but the server still did the full amount of work.
If there is a tax on your bill, you should technically calculate the tip based on the pretax amount, since the service you received has nothing to do with the tax. But since the difference between a tip on the total (including tax) or the pretax amount is not significant, it's not a recommended squabbling point. If your order costs $30, and the tax is 8%, the total is $32.40. A 15% tip on your order, before tax, is $4.50. The same tip on the grand total is $4.86. That's only a difference of 36¢. Even with an order of $1,000, the equivalent difference is still only $12!
Evaluate your service. The key is to objectively judge the service, and the service alone. If the food isn't good, the menu is sparse, the prices are outrageous, and/or the decor is appalling, all of this affects your dining experience, but is not the waiter's fault. If you're unhappy with it, don't patronize the restaurant again, or write a negative review somewhere. The service itself should be judged on:
How the food matched with your order,
Whether the food was hot and fresh from the kitchen (or not),
How attentive the server was to your needs,
How quickly your empty dishes were taken away,
How quickly it took to get your check and have your payment processed, and
Whether the server's demeanor was courteous and professional.
Give the benefit of the doubt. If the service was not quite stellar, it may not be the waiter's fault. Unless your waiter was rude or neglectful, you might want consider the following:
Did the entire restaurant appear busy and understaffed? Less attentive service might be the result of poor management.
Mistakes in orders do happen, and it's hard to know if the waiter, chef or both were responsible. If your waiter works hard to fix a problem, it's kind to give him the benefit of the doubt.
Does your waiter seem new to the job? Waiting takes a lot of practice and skill; you might want to give a new waiter a bit of a break.
Determine the tip. The general guideline is 20% for excellent service, 15% for solid service, and 10% for bad service.Cite error <cite_error_ref_too_many_keys>; $2 On average, people tip 18%.Cite error <cite_error_ref_too_many_keys>; $2
Give feedback to management or the directly to the waiter instead of, or in addition to, leaving a low tip. Many customers leave poor tips regardless of service, so simply doing so may not convey the message intended. A low tip is no guarantee that service will improve in the future because staff may not know what made you unhappy or who was responsible. Not only will the manager be able to correct the situation, but you might also get a compensation out of it.Cite error <cite_error_ref_no_input>; $2
If you're eating with small children and make a big mess, remember that staff will have to clean it up, and that this usually takes extra time. Consider leaving servers a little extra for this inconvenience for them. If the server is especially helpful with child-related issues during the meal, you might also wish to tip a little extra for that.
Calculate the tip. Now that you know what percentage you want to pay, it's time to actually crunch the numbers.
An easy way to figure a 20% tip is to move the decimal point of the cost to find 10%, and then double it. For example, if the bill is $35.00, 10% would be $3.50, and a 20% tip would be $7.00. For 15%, you would halve the 10% and add it to the original number. For $35.00 again, that would be $3.50 + $1.75 = $5.25.
Another way to figure out the tip is to remember:
10% = $1 for every $10,
15% = $1.50 for every $10, and
20% = $2 for every $10.
Pay with cash if you can. If you pay with credit card, the waiter might have to wait a week or two in order to pocket that money, whereas cash can be taken home sooner.Cite error <cite_error_ref_no_input>; $2 If you want to reward good service, it's more motivating to help the waitstaff take home their hard-earned tips sooner rather than later.
Round up. Don't leave pennies or excessive change on the table; waiters hate that.Cite error <cite_error_ref_no_input>; $2
Another reason to pay with cash is that if you pay with credit card, some restaurants subtract the credit card service fee from the tip.
If you want to feel especially generous, calculate the tip and add three or four extra dollars. You'll feel like a big shot for the rest of the day for very little cost. You'll also make up for some cheapskate who left a lousy tip.
Different parts of the world have different tipping etiquette. In most of Europe, and many parts in Asia, service is included in the price (and thus the waiters already have a decent hourly wage). However, a small tip (e.g., 10% or less) is considerate to offer for good service. The laws and customs of different places vary, so be sure to check before dining.
"Tip jars" are becoming more common at small take-out places, (e.g., coffee, bagel, and ice cream shops). These employees spend very little time with each customer, but are usually not paid a reasonable wage by the business. Tipping a small amount in these circumstances is much appreciated, especially because pooling many small tips during the day will help these low-paid workers to earn a reasonable wage overall.
Many restaurants have curbside and carryout servers. If you order food to go from a bartender or server, you are still expected tip at least 10%. Usually, the person that takes your order has to jump through more hoops to get your order together complete with silverware, extra napkins, bags etc. They go out of their way to take care of you, so you should take care of them back.
In a buffet restaurant, leave a 20% tip. The waiter is more than likely doing more work than the waiter in a regular restaurant, like constantly clearing your plates, bringing water, and taking drink orders.
The U.S. Government taxes servers, bartenders and baristas based upon an assumption that they made a certain percentage of their sales in tips. If you do not tip a server or a bartender in America at all, you are technically costing your server money. The IRS calculates an average percentage based on actual credit card tips the server (or restaurant) earns and applies that number to cash transactions.
Check to see if the tip is already included in the bill. Some restaurants will add a gratuity for large groups (typically 8 or more), and many restaurants outside the U.S. include the tip as part of the bill. If you are unsure, ask a member of staff whether tips are already included. On the other hand, some places will clearly print Gratuity not included on the bill.
Keep in mind that in most U.S. states, waiters and waitresses are paid a base wage that is significantly lower than the regular minimum (typically around $2.00/hour) because it's assumed that tips will make up the difference. Thus, unlike some other countries, tipping is expected in the U.S. if you receive service that is at least satisfactory. However, if the hourly wage plus the tips do not total the state's minimum wage, the employer must compensate the difference. Additionally, in some western states, such as California, Oregon, and Washington State, there is no lower wage and your server is making at least $8 or more per hour. Do not let this fact deter you from tipping, however, as the cost of living in these states is higher.