Yes. In the UK, sticker prices or advertisements aimed at consumers must include VAT where applicable. This is not so if the sticker/ad/whatever is aimed _sol

Yes. In the UK, sticker prices or advertisements aimed at consumers must include VAT where applicable. This is not so if the sticker/ad/whatever is aimed _solely_ at businesses (many of whom can claim back the VAT). Further info: http://www.hmrc.gov.uk/vat/sectors/consumers/basics.htm http://www.hmrc.gov.uk/vat/sectors/consumers/basics.htm Service charges are a different matter. Some restaurants advertise a mandatory service charge (e.g. 15%) on all bills, or for parties of x (e.g. 6) or more people. Although it may seem like increasing prices by the amount of the mandatory service charge would make life easier for everyone, services charges (even mandatory ones) are treated differently for tax purposes: if they are distributed to employees, they are not subject to VAT (revenue tax) or Corporation Tax (profits tax). They are, however, subject to payroll taxes (PAYE Income Tax and NIC): http://www.hmrc.gov.uk/paye/payroll/special-pay/tips.htm#1 http://www.hmrc.gov.uk/paye/payroll/special-pay/tips.htm#1