Hospitality Connections Meeting - Tipping Presentation

The Ontario Restaurant Hotel & Motel Association (ORHMA) Waterloo Region is hosting a complimentary presentation to help members understand the rules involving employers’ responsibility on handling electronic server tips in restaurants. This also includes aspects of tipping in hotels.

The session is presented by James Rhodes who has been practicing tax law for 24 years with both the Department of Justice, accounting firms, and law firms. He deals extensively with restaurant audits and creating gratuity systems for restaurants. He was hired by Restaurants Canada to intervene in the recent Federal Court of Appeal (FCA) case to support the restaurant industry.

In 2022, the FCA recently concluded that certain electronic gratuities were pensionable and insurable earnings meaning that the restaurant paying out the gratuities to its employees was required to withhold source deductions including CPP and EI on those gratuities. The failure of the restaurant to do so left it with a $100,000 CPP and EI liability. For more background information, click here.

James will go through Canada Revenue Agency’s tests involving gratuities and whether they are pensionable and insurable earnings. James will also discuss the recent FCA case and what employers should be doing with their gratuity system to minimize their change for unwanted tax liability.

James will also discuss the following:

1. EI and CPP issues with CRA verses ESA issues with MOL.
2. Controlled verses direct tipping, and the court ruling and why it’s different than what CRA allows.
3. What has to be done to ensure have direct tip system.
4. Establishing Grat Pool and how that is done for various tip systems.
5. Establishing governance rules.
6. What to do to protect yourself if you have systems that make a controlled tip, such as autograt.
7. Common mistakes.
8. The future of the industry and dual payment processing.

For more information, email info@orhma.com. 

Click here to RSVP.