Service charges question

luckyme502 · July 2010

I received my final inoice from the venue/caterer last night. There are afew mistakes, like being charged for an extra 12 adults, and some centerpieces we didn't order.

My question is about the service charge. They charged us a flat rate of 20% on everything. Is that normal? We are paying a rental fee, and a labor fee, they charged us the 20% on that too.

Then they charged us restaurant sales tax of 11.5% on everything, including the service charge. Sales ax here in VA is 5% and restaurant tax is 11.5%. Shouldn't the rental and labor fee be charged at 5% and the meals at 11.5%, and I really don't think we should be getting taxed on the service charge.

Thoughts please!!! Maybe I am just missing something.

J&K10910 · July 2010

For my venue, the service charge is actually the gratuity that is included, and it's not taxed.

future-mrs · July 2010

We'll have a 20% service charge on top of everything too. They like to nickel and dime ya.

vegasgroom · July 2010

My contract in Vegas included the 20% charge but it was explicitly listed as a gratuity so basically I dont have to worry about tipping any of the staff that work for the venue that night. It was not a taxable fee, but that will vary from one state to the next, worth checking out to see if it's legit in the state your venue is in.

luckyme502 · July 2010

That is what I thought, the service charge is the gratuity, so it shouldn't be taxed.

SarahPLiz · July 2010

In Response to <a href="http://forums.theknot.com/Sites/theknot/Pages/Main.aspx/wedding-boards_snarky-brides_service-charges-question?plckFindPostKey=Cat:Wedding BoardsForum:17Discussion:4133ffff-0705-4452-8e42-e3311d3d07eePost:2d53f34c-7f35-454d-908f-c469550fa7a9">Re: Service charges question</a>:
[QUOTE]I always thought service charge = gratuity.
Posted by Champagne Supernova[/QUOTE]

And I always thought gratuity was supposed to be discrectionary, relevant to the level of service actually provided. Otherwise they might as well just jack up their labor charge 20% and pay their people more.

tba0313 · July 2010

We have a 19% "service charge" and 6% sales tax for my venue. They took my total and added the 19% charge onto it, and then taxed that total. So I've been taxed on my service charge as well.

luckyme502 · July 2010

Well, I am about to call them and ask what everything is and what should be taxed and not, right after I eat lunch.

vegasgroom · July 2010

In Response to <a href="http://forums.theknot.com/Sites/theknot/Pages/Main.aspx/wedding-boards_snarky-brides_service-charges-question?plckFindPostKey=Cat:Wedding%20BoardsForum:17Discussion:4133ffff-0705-4452-8e42-e3311d3d07eePost:4538abb3-1f70-4370-8ed6-569b67b784e8">Re: Service charges question</a>:
[QUOTE]In Response to Re: Service charges question : And I always thought gratuity was supposed to be discrectionary, relevant to the level of service actually provided. Otherwise they might as well just jack up their labor charge 20% and pay their people more.
Posted by SarahPLiz[/QUOTE]

It's added in for the same reason why restaurants add the tip if the party is more than 8 or so guests; the venue is paying the staff below minimum wage, if the staff don't get tipped, they don't make enough to live on, and for a large party, the staff will be spending a lot of time working on your requests and not making money from any other guest. Of course bad service always sucks, so hopefully someone who doesn't deserve a tip gets reported to the manager and they can either correct the issue or get rid of the person, but just like a performance review at a salaried job, the person still deserves to be paid even if they aren't a good employee, up until the point where they're fired for not being good.

luckyme502 · July 2010

I called my venue/caterer. The service charge is not the gratuity. Apparently it is a charge to cover all the "little" items she provides/does. Like ironing the linens, the glasses, stuff like that. So, yes it is taxable. But we are also being charged for labor.

It's funny that it wasn't in our original contract. We are meeting with her on Thursday to do a final walk through, so I'm sure we will talk about it some more.

vegasgroom · July 2010

Oh wow; are they expecting you to pay the agreed rate, plus up charge, plus tax, plus tip the workers? Or are they salaried types that don't have to be tipped?

mica178 · July 2010

If that's what the service charge is for, you might still need to tip the servers. In that case, I'd just tip for the food/beverage cost, not the overall (tables, location fee, etc.) cost.

My venue is taxing our service charge. Something about how all non-cash gratuities in California are taxed. Yuck, so that's 9.75% on top of the 18%.

chirpchirp · July 2010

ummm... I call bullshiit. Not that I know a lot about venue contracts but the service charge is definitely the gratuity. Typically all the stuff she told you the "service charge" was to pay for is paid for through the venue cost and labor charges. Because that's why there is a labor fee. The staff doesn't get paid to stand around and look pretty... they're paid to do the things that they are charging you the "service fee" for. Lame.

Service charges question

2011 Reading Challenge

Re: Service charges question

2011 Reading Challenge

2011 Reading Challenge

2011 Reading Challenge

Choose Another Board

Search Boards