(Mar. 26/14) Restaurants Canada met with Revenue Quebec to discuss the agency’s pursuit of restaurateurs for tips not declared by servers. Revenue Quebec has been targeting family and fine dining restaurants, because it’s easier to identify false declarations with the significant use of payment cards to settle bills.
Many servers mistakenly believe they need to declare only eight per cent of their tips, when legislation requires that all tips must be declared. Employers are required to accept the tips declared by employees, make sure it matches at least eight per cent of sales, and pay payroll taxes on declared tips. The employer cannot change the tips declared, even if he or she knows it’s incorrect.
Restaurants Canada has successfully lobbied to ensure employers are not held responsible for false tip declarations made by staff. Instead, we have always recommended that restaurateurs inform new hires on the proper tip declaration rules. In our Feb. 24 meeting, we reiterated these points and asked the agency to launch an information campaign, similar to its one on fiscal evasion. We will continue to closely monitor this issue and keep members informed of any changes.