gratuity/tax question

okay, so i am less than two weeks away and about to make my final payment to the reception site. they gave me a number which seemed slightly over what i thought it would be and i just realized they are charging the sales tax ON TOP OF the gratuity. so, it is the per person fee plus 18% gratuity and then they chrge the 8.5% tax on top of that. shouldn't the tax only be on the per person charge and not on the gratuity. its a couple of hundred dollars and i'm not sure if this is right? any opinions?

Re: gratuity/tax question

That seems right. There is an 18% service charge plus the 8.5% tax on top of that.

So, if you were at $100 a plate, it's really $118 plus 8.5% sales tax, for a total of $128.03.

Stinks, doesn't it?

Re: gratuity/tax question

The way you should calculate it is to add the gratuity percentage and tax percentage together before multiplying by the per person charge. Here is an example:


$65 PP

18% Gratuity and 8.25% tax = 26.25%

$65 * 1.2625= $82.06 per person

If you do it this way you are only taxing the PP charge and the gratuity is not based on the tax paid. It sounds confusing, but this is the way it should done.

Re: gratuity/tax question

I think different places do it differently. It really makes no sense to me that they do it like this because when you you ever have to pay sales tax on a tip? I specifically asked when I booked the hall (westbury manor) and they don't tax the gratituity

Re: gratuity/tax question

it does stink. but its right. i can't believe they are taxing an extra percentage (and they are calling it a 'service charge' rather than a tip to get away with it). ugh...so much money these two weeks just flying out the window!!!

Re: gratuity/tax question

When we went to make our final pymt my hubby did not like the reality of the tax on top of a tip, he was like that's not right. They all do it that way

Re: gratuity/tax question

If you add the gratuity % and tax % together before applying you will not pay tax on tip. You should demand that your hall calcuate it this way. I calculated it both ways and it does make a difference.

Re: gratuity/tax question

Crisco, we had our wedding at CB and I see from your profile that is where you are having yours, they do it the same way...all the hall does it.

Re: gratuity/tax question

My BM is calculating it my way. I did not have to talk him into it. What BM did you have? I have Gerry Paul.

Re: gratuity/tax question

That is the way my hall does it. They call it a service charge so it is taxable.

Re: gratuity/tax question

and this service charge, from what I am told, is illegal, but they do it in a way so that its not..ya know what i mean?
At least this was what i was told by an actual hall owner whos a friend of a friend

Re: gratuity/tax question

i was told by a banquet manager, that if they call it 'gratuity' then legally it must be taxed. but if they call it a 'service charge' then it may not be taxed. i'm not sure if thats accurate though. really important to find this out before hand because it will alter your final payment dramatically.

x

x