Tips on Tippable Sales
The amount of tips on tippable sales that an employee must report to you is the total of the following:
- tips in cash received from customers on tippable sales made during the pay period (regardless of whether the customer paid in cash or by credit or debit card); and
- tips customers left by credit or debit card that the employee received during the pay period.
Example 1
A customer pays their cheque and leaves a tip using a credit card. You give the tip to your employee when you receive the amounts for the sale from the credit card issuer. In this case, the employee must report the tip in the pay period during which you received the amounts from the credit card issuer.
Example 2
A customer pays their cheque and leaves a tip using a credit card. You give your employee the tip at the end of their shift (in other words, before receiving any amounts for the sale from the credit card issuer). In this case, the employee must report the tip in the pay period during which the sale was made.