Can you hall tax you on mandatory gratuity???
Ladies,
I was on another board and saw this post. It def. helps me, I hops it helps some of you out.
Here is the Answer for whether your hall can tax you on your mandatory gratuity.
There is a NYstate tax regulation: 527.8(1) of the Sales and Use Tax related to section 1105(d) of the Tax Code. This section says that your hall CANNOT tax you on your gratuity if:
1. its set out as a separate charge (which most places do)
2. its called a gratuity (this is the kicker...check your contract; AND
3. the total gratuity amount goes to the hall's staff (waiters, bar tenders, etc.).
Be careful with #2. Read your contract, does it say 'gratuity' or does it say 'service charge'? If it says 'gratuity' you are in luck (ours says 20% gratuity). If it says 'service charge' you are out of luck. Also be careful in the billing statement, even though our contract says 20% gratuity, the billing statement we received says '20% service charge'. Remember, your contract trumps any bill. Its what your contract says that matters.
As for #3. I think its fairly easy. You call your hall, and gently inquire as to whether their employees will be paid through your gratuity, just to make sure there is no one other than matre d' to tip, etc. I doubt your hall will tell you that they won't pay your gratuity to the employees, and if they do, man, I feel bad for that hall....especially if that gets into any local newspapers.
The bottom line is, if you have all 3 of those things, they CANNOT tax you on your gratuity. This can save you as much as $1000 depending on the number of your guests and per head count!
Good luck!
I was on another board and saw this post. It def. helps me, I hops it helps some of you out.
Here is the Answer for whether your hall can tax you on your mandatory gratuity.
There is a NYstate tax regulation: 527.8(1) of the Sales and Use Tax related to section 1105(d) of the Tax Code. This section says that your hall CANNOT tax you on your gratuity if:
1. its set out as a separate charge (which most places do)
2. its called a gratuity (this is the kicker...check your contract; AND
3. the total gratuity amount goes to the hall's staff (waiters, bar tenders, etc.).
Be careful with #2. Read your contract, does it say 'gratuity' or does it say 'service charge'? If it says 'gratuity' you are in luck (ours says 20% gratuity). If it says 'service charge' you are out of luck. Also be careful in the billing statement, even though our contract says 20% gratuity, the billing statement we received says '20% service charge'. Remember, your contract trumps any bill. Its what your contract says that matters.
As for #3. I think its fairly easy. You call your hall, and gently inquire as to whether their employees will be paid through your gratuity, just to make sure there is no one other than matre d' to tip, etc. I doubt your hall will tell you that they won't pay your gratuity to the employees, and if they do, man, I feel bad for that hall....especially if that gets into any local newspapers.
The bottom line is, if you have all 3 of those things, they CANNOT tax you on your gratuity. This can save you as much as $1000 depending on the number of your guests and per head count!
Good luck!
