What Is a Tip Function in EFTPOS?
Enabling tipping in EFTPOS terminals, how it works for drivers
Intro
The tip function enables passengers to add a gratuity when paying by card through an EFTPOS terminal. It offers a seamless, transparent way for drivers to receive tips — improving both driver earnings and customer satisfaction.
Main Definition
In the taxi and transport sector, the tip function is a feature on payment terminals that prompts passengers to leave a tip before completing their payment. It may offer preset options (e.g. 5%, 10%, 15%) or allow custom input. This function helps drivers receive additional income through digital transactions, eliminates reliance on cash tips, and ensures all gratuities are tracked. Tips are usually recorded separately from fares, supporting proper tax reporting and compliance with local regulations.
Examples
A passenger takes a $40 ride and selects a 10% tip at checkout, adding $4 — for a $44 total charge.
CabFare’s EFTPOS terminals display $2, $5, or custom tip options on the screen before the rider taps to pay.
Some app-based POS systems allow optional tipping during digital payments, even without a physical terminal.
Key Relationships
Driver Income: The tip function increases earnings potential without requiring cash.
Transaction Processing: Tips are handled as separate line items and may not be subject to platform fees.
Customer Experience: Tipping via card provides a fast, modern, and frictionless way to reward good service.
Compliance & Reporting: Tip records must be kept separate from fare totals and disclosed for accounting purposes.
Integration: Tip support depends on the capabilities of your payment gateway and POS software.
Frequently Asked Questions
Are tips through EFTPOS taxed?
Yes, tips are typically treated as income and may need to be reported depending on regional tax laws.Can the tip function be disabled?
Yes. Merchants or fleet managers can choose whether to enable tipping on their payment terminals or apps.Do drivers receive the tip immediately?
Tips are generally included in the same payout cycle as the fare but may vary based on provider setup.
