Wiktionary
n. (context legal English) Time spent in remand awaiting trial, when credited after a guilty verdict usually by subtracting from the sentence.
Wikipedia
In criminal law, "time served" describes a sentence where the defendant is credited immediately after the guilty verdict with the time spent in remand awaiting trial. The time is usually subtracted from the sentence, with only the balance being served after the verdict. For example, the final verdict in the trial of Louise Woodward was that she was guilty, and her sentence was "time served" (in her case 279 days). In this case, this meant she was immediately released.
In some cases, time served may earn credit at a different rate than regular incarceration. For example, the defendant may get credit for a multiple of the amount of time spent in remand, for example two times, so that two months in remand gives four months' credit toward the sentence.
Time served is also a term used to indicate a craftsman has spent the required period as an apprentice.
Usage examples of "time served".
Thus he accounted that he served a twofold purpose: he took compensation and at the same time served, not indeed the Stuart King, whom he despised, but England and, for that matter, all the rest of civilized mankind which cruel, treacherous, greedy, bigoted Castile sought to exclude from intercourse with the New World.