Tax on Reception Service Charge

jayidee Posted: Jul 08, 2004 11:47 PM

Tax on Reception Service Charge

Are we supposed to pay tax on the service charge/gratuity at the hall?

Seems odd to me.

MamanDaddyof2 Posted: Jul 08, 2004 11:56 PM

Re: Tax on Reception Service Charge

AtticaQT Posted: Jul 09, 2004 12:14 AM

Re: Tax on Reception Service Charge

my hall taxes teh service charge

honeybee Posted: Jul 09, 2004 01:14 AM

Re: Tax on Reception Service Charge

yup... thats standard.

newbie Posted: Jul 09, 2004 02:11 AM

Re: Tax on Reception Service Charge

Even though it seems to be customary within the industry, it still seems odd to me, too. I am going to try to research this.

June13/04 Posted: Jul 09, 2004 02:16 AM

Re: Tax on Reception Service Charge

Like we're not paying enough as it is!!.... tax on tips tax on everything!!! I'm surprised they don't tax every drink a guest has at the bar!

MrsK-in-June05 Posted: Jul 09, 2004 06:34 AM

Re: Tax on Reception Service Charge

everything is taxed..if you are getting married in nyc it is 8.25%, nassau is 8.25% or 8.5% and suffolk is 8.75%. I hate tax!

kazee525 Posted: Jul 09, 2004 07:27 AM

Re: Tax on Reception Service Charge

my sister-in-law told me that it is ILLEGAL for them to charge tax on gratuity..tax percentage should be based on the price per person times number of people ONLY...gratuity is SEPARATE!!! If you are being charged tax on the service charge, you should definitely say something to your hall.

lianemarie Posted: Jul 09, 2004 07:41 AM

Re: Tax on Reception Service Charge

A service charge is not a gratuity- its considered a fee to pay for the waitstaff etc.
Thats why it is taxed

Most halls that will charge a service charge will aso ask for a gratuity for the Maitre D

Joey'sbaby Posted: Jul 09, 2004 08:08 AM

Re: Tax on Reception Service Charge

Service charge and gratuity are 2 different things....service charge is a fee to pay for service personnel's salaries - therefore revenue for the caterer and taxable while gratuity is a tip and not revenue for the caterer (is should go directly to the staff through a seperate account and check) and is therefore taxed as income for the staff member.

eogara Posted: Jul 09, 2004 08:12 AM

Re: Tax on Reception Service Charge

Posted by kazee525

my sister-in-law told me that it is ILLEGAL for them to charge tax on gratuity..tax percentage should be based on the price per person times number of people ONLY...gratuity is SEPARATE!!! If you are being charged tax on the service charge, you should definitely say something to your hall.

Of course it's illegal!! You don't pay tax on the tip in a restaurant. My hall doesn't charge it - they gave us the price and it's not taxed on the gratuity at all. I'd double check that.

tina_cuse01 Posted: Jul 09, 2004 08:37 AM

Re: Tax on Reception Service Charge

Posted by lianemarie

A service charge is not a gratuity- its considered a fee to pay for the waitstaff etc.
Thats why it is taxed

Most halls that will charge a service charge will aso ask for a gratuity for the Maitre D

This is there way of getting around it, calling it a 'service charge'. It is actually a very shady practice in the industry. It is ILLEGAL and I would call your place on it.

jayidee Posted: Jul 09, 2004 09:04 AM

Re: Tax on Reception Service Charge

Have my final meeting today - I'll bring it up and wait for the response.
Thanks.

lianemarie Posted: Jul 09, 2004 09:13 AM

Re: Tax on Reception Service Charge

Posted by tina_cuse01

Posted by lianemarie

A service charge is not a gratuity- its considered a fee to pay for the waitstaff etc.
Thats why it is taxed

Most halls that will charge a service charge will aso ask for a gratuity for the Maitre D

This is there way of getting around it, calling it a 'service charge'. It is actually a very shady practice in the industry. It is ILLEGAL and I would call your place on it.

All I am saying is that a service charge and a gratuity are two different things. Service charges pay for the waitstaff's salaries and is not considered tips for them. That is why it is taxed. The waitstaff does not get that cash as tips.
The halls that charge a service charge often recommend a gratuity as well.

newbrideOct Posted: Jul 09, 2004 09:33 AM

Re: Tax on Reception Service Charge

Why do the halls charge separately for the price of a person and then service if that's an employees salary? Why don't they make it one price?

jannshari Posted: Jul 09, 2004 09:36 AM

Re: Tax on Reception Service Charge

The 'service charge' is taxable. Unfortunately. We're basically paying almost 30% sales tax on the per person charge. Crooks...all of 'em. But we keep them in business and we need them more than they need us, because there will always be a schnook willing to pay it.

By the way, I'm one of those schnooks.

Ang&Rich Posted: Jul 09, 2004 09:37 AM

Re: Tax on Reception Service Charge

If someone has discussed this with their hall can you please post the outcome? Thanks - it'll be helpful to all of us.

jayidee Posted: Jul 09, 2004 09:40 AM

Re: Tax on Reception Service Charge

When I go tonight - I will ask for a complete explanation. Sometimes they say gratuity and sometimes they say service charge. I guess depending on the 'term' - they charge tax or they don't.

bridzilla Posted: Jul 09, 2004 09:45 AM

Re: Tax on Reception Service Charge

My contract says gratuity and they are charging tax on it. This makes me really mad. I know even if I talk to them, they'll come up with some BS saying that they are allowed to charge tax on it. I need a tax attorney! Anyway, let us know how your appt goes.

kazee525 Posted: Jul 09, 2004 09:47 AM

Re: Tax on Reception Service Charge

Posted by Ang&Rich

If someone has discussed this with their hall can you please post the outcome? Thanks - it'll be helpful to all of us.

when i looked at halls, i asked all of them that question...now granted, i only looked at 3 halls, but they all said the same thing: gratuity is NOT taxed!