Payment links with built-in tipping are offered by Square, Stripe, PayPal, Toast, and Clover—each with different tipping rules and visibility options.
A payment link is a URL you send to a customer that opens a checkout page where they pay you directly. When tipping is enabled, the customer sees tipping options on that page before they complete the transaction. The processor collects the payment and tip together, deposits both to your account, and reports them separately on your settlement statement.
Not every processor offers tipping on payment links, and those that do vary in how much control you have over the amounts shown, whether tipping appears before or after the customer enters their payment method, and whether you can turn tipping on or off for individual links.
Key Takeaways
- Square, Stripe, PayPal, Toast, and Clover all support tipping on payment links, but each has different default amounts and customization options.
- Some processors show tipping before payment details are entered; others show it after, which can affect how many customers add a tip.
- You can usually turn tipping on or off per link, so you control which transactions include the option.
- Tipping is reported separately from the base payment on your settlement statement and tax forms, so you can track it independently.
- Processor fees apply to tips the same way they apply to the base payment amount.
Square payment links and tipping settings
Square lets you add tipping to any payment link you create through your Square Dashboard. When you set up the link, you choose whether to include a tip screen. If you do, Square shows three default tip percentages (15%, 20%, 25%) or you can set custom amounts instead.
The tip screen appears after the customer enters their payment method but before they see the final confirmation. Customers can also enter a custom tip amount if none of the preset options match what they want to give. Square charges its standard processing fee (2.9% + 30 cents for online payments, or your negotiated rate) on the tip amount as well as the base payment.
Stripe payment links with configurable tips
Stripe's payment links support tipping through their Billing Portal and direct link creation. When you build a link in the Stripe Dashboard, you can enable a tip screen and choose between percentage-based tips (Stripe suggests 15%, 18%, 20%) or fixed amounts you define yourself.
Stripe displays the tip options after the customer enters their email and shipping address but before final payment confirmation. Unlike some competitors, Stripe does not allow customers to enter a custom tip amount outside your preset options—they must choose from what you provide or skip tipping entirely. Stripe's standard processing fee (2.9% + 30 cents for US online payments) applies to tips.
PayPal payment links and tip customization
PayPal's Payment Links feature (created through your PayPal Business account) includes a tipping option you can toggle on or off. When enabled, PayPal shows three default tip percentages (10%, 15%, 20%) on the checkout page. You cannot customize these percentages through the standard payment link interface—the defaults are fixed.
The tip prompt appears on the same screen where the customer reviews the item price and shipping, before they enter payment details. PayPal's transaction fees (2.99% + 30 cents for standard payments, or your negotiated rate) apply to the tip. If you need more control over tip amounts, you would need to use PayPal's more advanced invoicing tools or integrate with a third-party app.
Toast and Clover for restaurant and retail tipping
Toast and Clover are point-of-sale systems that also generate payment links for remote or online orders. Both include tipping as a standard feature because their primary customers are restaurants and retail shops where tipping is expected.
Toast's payment links show tipping options after the customer selects items and enters delivery or pickup details. You can set custom tip percentages or amounts in your Toast settings, and those apply to all payment links generated from your account. Clover works similarly—tipping is enabled by default on Clover payment links, and you configure tip amounts in your Clover Dashboard. Both systems report tips separately on your settlement and tax documents.
How tipping appears and when customers see it
The placement of the tipping screen matters. If tipping appears early in the checkout flow (before payment details), more customers tend to see it and consider adding a tip. If it appears after payment information is entered, some customers have already mentally completed the transaction and skip the tip screen.
Square and Stripe show tipping after payment method entry. PayPal shows it earlier, on the order review screen. Toast and Clover show it after item selection but before final payment, which is the typical retail and restaurant flow. If you are choosing a processor partly for tipping, test the checkout flow yourself to see whether the timing matches your customer base.
Processing fees on tips and tax reporting
Every processor charges its standard transaction fee on the tip amount. If you pay 2.9% + 30 cents per transaction, that fee applies to the tip just as it applies to the base payment. Some business owners are surprised by this—they expect tips to be fee-free—but that is not how any major processor works.
Tips are reported separately on your monthly settlement statement and on your year-end tax forms (1099-K if you meet the threshold). This separation makes it easier to track tip income independently from product or service revenue. Keep your settlement statements to reconcile tip amounts if you are audited or need to verify what you received.
Frequently Asked Questions
Can I turn off tipping for some payment links but not others?
Yes. Square, Stripe, PayPal, Toast, and Clover all let you toggle tipping on or off when you create each individual link. You might disable tipping for a one-time product sale but enable it for a service payment or donation link. The setting applies only to that specific link.
What happens if a customer enters a tip amount that seems too high or too low?
Most processors accept whatever tip amount the customer enters (or selects from your presets) without validation. If you set custom tip options, you control the range. If a customer enters a custom amount and it seems unusual, you can refund the tip portion through your processor dashboard after the transaction settles, though this requires manual action on your part.
Do I have to accept tips on payment links?
No. You can create payment links without enabling tipping at all. Tipping is optional—you turn it on only if you want to offer it. Many businesses use payment links for product sales where tipping is not expected and leave the feature disabled.
Which processor lets me customize tip amounts the most?
Square and Stripe give you the most control. Both let you set custom tip percentages or fixed amounts instead of using defaults. Toast and Clover also allow customization through your account settings. PayPal's standard payment links are limited to fixed percentages and do not offer as much flexibility.
Are tips subject to sales tax?
No. Tips are not taxable as sales revenue in any US state. However, tips are income to you and must be reported on your tax return. Your processor reports tips separately so you can distinguish them from taxable sales on your records.