Waitressing and tips and tax
#1
Waitressing and tips and tax
Hi all,
Quick question, my daughter has a job in a restaurant and has just been promoted to a server/waitress for some shifts. What happens at tax time? Should she be keeping a note of her tips? I have suggested she saves some for tax time, but would like to have an idea how much she will likely to have to part with.
TIA
Quick question, my daughter has a job in a restaurant and has just been promoted to a server/waitress for some shifts. What happens at tax time? Should she be keeping a note of her tips? I have suggested she saves some for tax time, but would like to have an idea how much she will likely to have to part with.
TIA
#2
Binned by Muderators
Joined: Jul 2007
Location: White Rock BC
Posts: 11,682
Re: Waitressing and tips and tax
Hi all,
Quick question, my daughter has a job in a restaurant and has just been promoted to a server/waitress for some shifts. What happens at tax time? Should she be keeping a note of her tips? I have suggested she saves some for tax time, but would like to have an idea how much she will likely to have to part with.
TIA
Quick question, my daughter has a job in a restaurant and has just been promoted to a server/waitress for some shifts. What happens at tax time? Should she be keeping a note of her tips? I have suggested she saves some for tax time, but would like to have an idea how much she will likely to have to part with.
TIA
Common practice is that many people declare 10% of their T4 income as tips. I don't recommend this as it likely understates most server's income but is better than putting nothing - the CRA know perfectly well they are earning tips.
#4
Account Closed
Joined: Feb 2009
Posts: 0
Re: Waitressing and tips and tax
Remind her to grin like an idiot as she presents the bill
My friend says that she declares 25% (been doing it 15 years) and never had any grief off of the revenue
My friend says that she declares 25% (been doing it 15 years) and never had any grief off of the revenue
#5
Joined: Aug 2005
Posts: 14,227
Re: Waitressing and tips and tax
Drawing a smiley face or a heart on the bill is a good way to manipulate people into giving more tips.
#6
Forum Regular
Joined: Jan 2011
Posts: 71
Re: Waitressing and tips and tax
What's the going rate for leaving tips - 10%? 15%? I assume the same for the pizza delivery guy etc too?
#7
Re: Waitressing and tips and tax
Writing your name upside down on the paper tablecloth is a sure-fire hit with customers too.
I'm surprised that the CRA lets people away with 10% declared as tips. I knew a Calgary barman who said he made $11/hour basic, and "at least that again" in tips.
I'm surprised that the CRA lets people away with 10% declared as tips. I knew a Calgary barman who said he made $11/hour basic, and "at least that again" in tips.
#8
Banned
Joined: Oct 2008
Location: the GTA
Posts: 3,824
Re: Waitressing and tips and tax
Assuming the service and food is at least satisfactory I leave 15%, excluding the taxes of course. For a pizza delivery person I give him/her a flat $2.
#9
Re: Waitressing and tips and tax
She is regretting doing her best to lose her English accent, she is trying to reclaim it though
#10
Re: Waitressing and tips and tax
' server/waitress for some shifts.'
Off the record, don't bother. Don't pay any of the tips into her bank account in case she is audited. A waitress wage is so low I doubt it would be a fuss.
Off the record, don't bother. Don't pay any of the tips into her bank account in case she is audited. A waitress wage is so low I doubt it would be a fuss.
#11
Re: Waitressing and tips and tax
When I speak to Canadian co workers, I am still amazed that they leave tips when they have had crappy service, I know it is an entirely different culture here for tips from restaurant to cab drivers to hair dressers to even someone at work who makes cakes for fun!, but they still tip regardless of the service!
#12
Binned by Muderators
Joined: Jul 2007
Location: White Rock BC
Posts: 11,682
Re: Waitressing and tips and tax
That is really not a good idea. People in hospitality earn tips. The CRA knows that. Declaring no tips can raise a red flag.
#13
Re: Waitressing and tips and tax
You are right. But I used to run a bar, so my advice is only based upon my own experience.
Many of the waitresses we hired were from out of province and it was entry level job to get to other levels. To be honest there is by the book and then how it is really done. By all means, declare tips.
But they(waitresses) earn so low and the hours are horrible. Investigating them for tax evasion, its miniscule in comparison to what I have seen some people dodge.
Many of the waitresses we hired were from out of province and it was entry level job to get to other levels. To be honest there is by the book and then how it is really done. By all means, declare tips.
But they(waitresses) earn so low and the hours are horrible. Investigating them for tax evasion, its miniscule in comparison to what I have seen some people dodge.
#14
Account Closed
Joined: Jan 2007
Posts: 2,404
Re: Waitressing and tips and tax
I leave 15% if the service is acceptable or better.... and zero if it's crap.
#15
Re: Waitressing and tips and tax
You are right. But I used to run a bar, so my advice is only based upon my own experience.
Many of the waitresses we hired were from out of province and it was entry level job to get to other levels. To be honest there is by the book and then how it is really done. By all means, declare tips.
But they(waitresses) earn so low and the hours are horrible. Investigating them for tax evasion, its miniscule in comparison to what I have seen some people dodge.
Many of the waitresses we hired were from out of province and it was entry level job to get to other levels. To be honest there is by the book and then how it is really done. By all means, declare tips.
But they(waitresses) earn so low and the hours are horrible. Investigating them for tax evasion, its miniscule in comparison to what I have seen some people dodge.
Talking to a dental hygienist yesterday, who worked as a waitress for a year only declared 10% of her tips, 8 years on she is investigated still every year - I want my daughter to avoid this. BTW Canadian restaurant staff don't seem to work the atrocious hours that UK restaurant staff work.