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How to calculate a tip pool: by hours, by points, or evenly

Last reviewed 2026-11-07 · How to calculate

A tip pool is simple arithmetic that goes wrong in the same three places every night: the tip-out gets taken after the split instead of before, two people disagree on what a “share” is, and the cents don’t add up. Here is the full method, with numbers you can check.

Step 1: Start with the pool, then take the tip-out off the top

Write down the total tips for the shift (cash plus card tips, after any policy-allowed processing fee). If your house pays a tip-out to the kitchen, bussers or barbacks as a percentage, take it off before splitting. The number you split is:

To distribute = Total tips − Tip-out

Example: $842.50 in tips, 10% kitchen tip-out. Tip-out = $84.25. To distribute = $758.25.

Taking the tip-out after the split, from each person separately, gives the same total but a different split whenever anyone has a different weight, so pick one order and write it into the policy. Off the top is the common one.

Step 2: Pick a weight for every person

Every method below is the same formula with a different weight:

Payout = To distribute × (person’s weight ÷ sum of all weights)

MethodWeightBest for
By hours workedHours on the clockHouses where every role in the pool does similar work; the most common method
By role points × hoursHours × a point value per role (server 1.0, bartender 1.0, busser 0.6, host 0.5)Pools that include support roles expected to earn a smaller share per hour
Evenly1 for everyoneShort, fixed-length shifts where everyone worked the same time (banquets, events)

Worked example: five people, $758.25 to distribute

NameRoleHoursPointsBy hoursBy points × hoursEvenly
MayaServer7.51.0$174.98$206.04$151.65
JordanServer6.01.0$139.98$164.83$151.65
ChrisBartender8.01.0$186.64$219.78$151.65
SamBusser6.00.6$139.98$98.90$151.65
LeeHost5.00.5$116.65$68.68$151.65
Total paid out$758.23$758.23$758.25
Rounding remainder$0.02$0.02$0.00

By hours: total hours are 32.5, so Maya’s share is 7.5 ÷ 32.5 = 23.08% and her payout is $758.25 × 0.2308 = $174.98 (rounded down). By points × hours: the weights are 7.5, 6, 8, 3.6 and 2.5, total 27.6, so Maya’s share is 7.5 ÷ 27.6 = 27.17% → $206.04, while Sam the busser drops from 18.46% to 13.04%. Evenly: $758.25 ÷ 5 = $151.65 each. These are the exact figures the free calculator produces for the same inputs.

Step 3: Round down, and show the remainder

Shares rarely land on whole cents. If you round each payout to the nearest cent you can end up paying out a few cents more than you collected. The rule that always balances: round each payout down to the cent, add them up, and report the leftover cents as a remainder (usually under a dollar). Put the remainder in the next pool, give it to whoever closed, or round it into the tip-out — just write the rule down so nobody argues about 7 cents at 1 a.m.

Step 4: Put it on paper

A settlement sheet with the date, the method, the total, the tip-out, each person’s hours, share and payout, and a signature line is what ends disputes. It is also the record US federal law expects you to keep when you run a tip pool (contributions and distributions), and what New York, the UK and Ontario require explicitly. The free calculator prints one.

Who can be in the pool is a legal question, not a math one. In the US, owners, managers and supervisors can never take a share. Whether cooks and dishwashers can be included depends on whether you take a tip credit; California and New York have their own lists. See the federal rules and the state guides before you set the roles.

Common mistakes

FAQ

Should the kitchen tip-out come before or after the split?
Either is legal where kitchen tip-outs are allowed; before (“off the top”) is the usual practice and the one the SplitTips calculator uses. The total paid out is the same; what changes is how the tip-out cost is shared between people with different weights.

What is a “point” in a point-based tip pool?
A weight per role that is multiplied by hours. Servers and bartenders are typically 1.0; bussers, runners and hosts something between 0.4 and 0.8. The numbers are house policy, not law, but they must not be used to disguise a share for a manager.

Why don’t the payouts add up exactly to the pool?
Rounding. If each payout is rounded down to the cent, the sum is a few cents under the pool; the difference is the remainder. Report it on the sheet rather than hiding it.

Can I split credit card tips on the same sheet as cash tips?
Yes — they are one pool. Some jurisdictions let the employer deduct the card processing fee from card tips first (US federal law allows a proportional deduction; California does not). Enter the net figure your policy allows.

Official sources

Split tonight’s tips in 30 seconds

The free SplitTips calculator splits a pool by hours, by role points or evenly, takes the kitchen tip-out off the top and prints a settlement sheet. No account needed.

Related guides

This guide is general information for operators, not legal, tax or payroll advice. Rates and rules change; the official sources above are the authority. SplitTips applies the rule you set and does not decide what is lawful in your jurisdiction.