Money, tipping and costs in London: a budget guide

Where a London trip actually gets expensive

London has a reputation for being one of the pricier city breaks in Europe, and the reputation is fair — but it is fair for specific reasons, not for everything. Hotels in central zones and meals eaten inside the main tourist strips (right by Buckingham Palace, on the South Bank promenade, around Leicester Square) carry a premium. Away from those pinch points, the city is more forgiving than most visitors expect, mostly because two of its biggest cost centres — museums and transport — are either free or automatically optimised for you.

This page is the general framework: currency, the fare cap system, tipping norms, and where the cheap and expensive pockets of the city sit. For street-by-street detail on where to eat or which market has the best-value stalls, the things to do in London hub and the individual neighbourhood guides go further than a citywide overview can.

Currency: pounds sterling, not euros

The UK’s currency is the pound sterling (£, GBP), not the euro. This sounds obvious written down, but the mistake shows up often enough in traveller forums that it is worth stating plainly: bring pounds, price things in pounds, and do not mentally convert as if you were in the eurozone, because the two currencies move independently and the gap changes.

Cards and contactless payments (physical card or phone) are accepted almost everywhere in London — shops, pubs, restaurants, market stalls, taxis, buses, the Tube. Cash is genuinely optional for most visitors; a few independent stalls prefer it, and it is worth carrying a little for that reason, but you will not be stuck without it.

One detail worth knowing before you land: contactless payments in the UK are capped by your bank, currently at £100 per transaction. That is a banking rule, not a London rule, and it has nothing to do with how public transport fares work — more on that below, because the two get confused constantly.

Free museums: the single biggest saving in the city

If there is one fact that changes a London budget more than any other, it is this: the UK’s major national museums and galleries do not charge for entry to their permanent collections. That includes the British Museum, the National Gallery, the Natural History Museum, the Science Museum, the Victoria and Albert Museum, Tate Modern, Tate Britain and the National Portrait Gallery. You can walk in, spend as long as you like, and walk out having paid nothing beyond the cost of getting there.

What is not free: special or touring exhibitions inside those same museums, and separately ticketed historic sites and attractions such as the Tower of London, Westminster Abbey, the London Eye or the Warner Bros. Studio Tour. Those charge full price and often benefit from booking ahead. Treat “national museum” and “major attraction” as two different categories when you budget — one is free, the other usually is not.

For a day built entirely around free sights, the free things to do in London guide and the broader London on a budget guide lay out a fuller itinerary than fits here.

Category	Typical cost	Example
National museum, permanent collection	Free	British Museum, Tate Modern
National museum, special exhibition	£15–£25	Varies by show
Major paid attraction	£25–£40	Tower of London, London Eye
Public park	Free	Hyde Park, Greenwich Park
Guided walking tour	£15–£35	See tour options below

Prices shift with the season and the exhibition, so treat this table as a range for planning, not a fixed quote — check the attraction’s own page or the relevant GetYourGuide or Viator listing for the number on the day you actually book.

Transport: Oyster, contactless, and the two caps people mix up

Getting around London for a visitor almost always means the same choice: a pay-as-you-go Oyster card or a contactless card or phone, tapped on the yellow readers at Tube, bus, DLR, Overground and most rail entry points inside London. Both systems work the same way and both do something genuinely useful: they cap what you pay.

Transport for London tracks every tap across a day and a week and automatically stops charging once you reach the maximum fare for the zones you have travelled through — it works out the cheapest combination for you, without any calculation on your part. There is no limit on how many journeys you can take once you are capped; you can ride all day for the price of the cap.

This is the point where two completely separate limits get confused, and it is worth being precise about it because getting it wrong causes real confusion mid-trip:

• The TfL fare cap is about how much you pay for travel across a day or week. It has no relation to individual transactions and no fixed number — it depends on which zones you travel through.
• The £100 contactless limit is set by your bank, applies per transaction, and has nothing to do with transport at all. It is the same limit that applies if you tap your card to pay for a coffee or a coat.

Neither cap stops you tapping in and out repeatedly through the day. If your single Tube fare seems to be declining normally and then suddenly nothing is charged, that is the TfL cap doing its job, not a card problem. For the fuller comparison between the two payment methods, see Oyster card vs contactless payment; for the practical basics of getting around by Tube, bus, and boat, see getting around London: Tube, bus and boat.

Tipping: no fixed rule, watch the bill

Tipping in London is not the fixed-percentage expectation it is in some other cities. In sit-down restaurants, many venues add a service charge of around 12.5% directly to the bill — check before adding a tip on top, since some visitors end up double-tipping without realising it is already included. If no service charge appears and you were happy with the meal, 10–12.5% is a reasonable addition, but nobody will chase you for it.

In pubs, tipping is unusual. There is no table service tradition to tip against in most pubs — you order and pay at the bar — and rounding up or offering to buy the bartender a drink is the more natural gesture than leaving cash. Taxis and rideshare apps: rounding up is common but not obligatory. Hotel staff and tour guides: a few pounds for genuinely good service is appreciated, never demanded.

Eating without paying tourist-strip prices

The fastest way to inflate a London food budget is eating directly outside a major attraction, where prices climb because the customer base is one-time. The fix is simple: walk two or three streets away, or head toward a food market instead of a sit-down restaurant on the main strip.

Street food markets are the most reliable value: Borough Market on the South Bank has excellent stalls but leans toward the higher end for full meals; the East London markets around Brick Lane and Columbia Road tend to run cheaper. Supermarket meal deals (a sandwich, snack and drink for a fixed low price) are a genuinely useful lunch option that many visitors never discover. Bakery chains and coffee shop chains scattered everywhere in the city are consistently priced and consistently fine, if not memorable.

For a guided introduction to where the better-value food actually is, a food-focused walking tour can save more time than trial and error:

a guided food tour through some of London’s better-value eating streets

If you would rather explore markets and neighbourhood food scenes on your own terms and cover more ground quickly, an e-bike route through several districts in one afternoon is a way to scout cheap-eat streets without burning a full day walking:

an e-bike tour that covers several neighbourhoods and their food streets in one outing

The London food markets and food tours guide has the neighbourhood-level detail this page does not try to duplicate.

A free (or nearly free) walking day, done properly

Some of the most memorable hours in London cost nothing but the walk itself, and a good guided walk pays for itself if it saves you from wandering past things you did not realise were significant. A walking tour built around the history of money, power and institutions in the City and Westminster is a natural fit for a budget-minded day, since it turns free-to-walk streets into something with actual context:

a historical walking tour through the streets where London’s money and power have long been concentrated

For something lighter and odder — the kind of tour that fills an hour between a free museum and dinner without costing much — a quirky themed walk is a low-stakes way to see a different side of the city:

an offbeat guided walk covering some unexpectedly interesting corners of the city

Where the money goes by trip length

A rough framework, not a fixed quote: for a short city break, expect accommodation to be the largest line item regardless of budget discipline elsewhere, followed by paid attractions, then food, then transport (which the fare cap keeps genuinely modest). A visitor doing mostly free museums, market lunches, pub dinners and one or two paid attractions across a week will spend markedly less per day than someone eating at restaurants beside major sights and booking a paid attraction daily.

Trip length	Museums	Transport	Food	One or two paid attractions
Long weekend	Free	Capped daily	Market/pub level	1 attraction
One week	Free	Capped weekly	Mixed	2–3 attractions
Ten days+	Free	Capped weekly, repeated	Mixed	3–4 attractions, spread out

For the neighbourhood-level version of this — which parts of central London are naturally cheaper to base yourself in, and which streets to avoid for meals — see London on a budget and, for the wider question of whether the city break is worth the cost at all, is London too expensive for a city break?.

Common money mistakes worth avoiding

A few habits repeatedly cost visitors more than they needed to spend, or cause confusion mid-trip:

• Paying for a paid ticket to a national museum’s permanent collection by mistake — check whether the charge is for a special exhibition before buying.
• Assuming the £100 contactless limit is a transport rule — it is a banking rule, unrelated to the TfL fare cap.
• Adding a tip on top of an already-included 12.5% service charge without checking the bill first.
• Eating the first restaurant you see directly outside a major attraction, rather than walking a few minutes further.
• Converting prices to euros out of habit — the currency is sterling, and the two do not move together.
• Assuming cash is required somewhere it is not — most of London runs on cards and contactless.

For the detail on payment confusion specifically, does contactless work on the Tube? and pounds or cards in London? cover the practical edge cases. For tipping specifically, how much to tip in a London restaurant goes further than the summary above.

A note on entry requirements and planning ahead

Money and travel authorisation are separate systems, but visitors sometimes conflate them: an Electronic Travel Authorisation (ETA), applied for only through gov.uk/eta before travel, is required for most visitors including EU nationals, and it has nothing to do with Oyster, contactless or the fare cap. Budgeting for the trip should include sorting the ETA well before departure, since it is a legal requirement to travel, not an optional extra. The UK ETA and entry rules for London guide covers this separately and in full.

If your trip includes structured day planning around a set budget, the budget week in London itinerary lays out a full week built around the principles on this page — free museums, capped transport, and food away from the tourist strip — day by day.

Money and costs in London: frequently asked questions

What is actually free to do in London?

All the permanent collections at national museums and galleries are free, including the British Museum, the National Gallery, Tate Modern, Tate Britain, the V&A, the Science Museum and the Natural History Museum. Parks, most markets, and walking through neighbourhoods like the South Bank or Greenwich cost nothing beyond travel.

Do I need cash in London?

Rarely. Contactless cards and phones are accepted almost everywhere, including on every form of public transport, and many small shops now refuse cash entirely. Keep a small amount for the odd market stall that is card-only-averse, but you will not need much.

How does the fare cap work on Oyster and contactless?

Transport for London automatically caps what you pay across a day and a week once you tap in and out with the same Oyster card or the same contactless card or phone, so you never need to work out the cheapest ticket yourself. This TfL fare cap has nothing to do with the separate £100 per-transaction limit your bank sets on contactless payments.

Should I tip in London restaurants and pubs?

There is no fixed expectation, but many restaurants add a 12.5% service charge to the bill automatically, so check before adding more on top. In pubs, tipping is uncommon; rounding up or buying the bartender a drink is a nicer gesture than a percentage tip.

Is the £100 contactless limit the same as the TfL daily cap?

No, and mixing these up is a common and costly mistake. The £100 limit is set by your bank per transaction and has nothing to do with transport; the TfL cap is a separate system that automatically stops charging you more fares once you hit the daily or weekly maximum for the zones you have travelled through.

Where can I eat cheaply without leaving central London badly served?

Street food markets, chain bakeries, supermarket meal deals, and neighbourhoods a short walk or one stop from the main sights (Bloomsbury side streets, parts of the South Bank, East London) all cost noticeably less than a sit-down meal directly outside a major attraction.

How much should I budget per day in London?

A tight but comfortable day covering transport, a market lunch, a pub dinner and one paid attraction typically runs somewhere in the range of £50 to £90 per person; free museum days and self-catering breakfasts bring that down further.