Service charge is the compulsory charge for service. An example would be charging 15 percent of the bill for a large dining group. The service charge is not a tip. If an employee receives tips in addition to the compulsory service charge, the service charge will be part of the calculation for minimum wage verification for tipped employees. For more information, visit the United States Department of Labor - Wage and Hour Division (WHD) website.
Select
Setup
then
Payroll Items
for your client.
Select
Add
.
Enter the
Description
and
Report Description
to represent the amount of tips for your employee.
Select
Fixed Amount
under
Calculation Type
.
Select
Service Charge
under
Special Type
.
(Optional) Mark
Net Pay
under
Exclusions
to exclude reported tips from net pay.
Enter any additional information under the Main, Tax Exemptions, Special Timing, and Workers' Compensation tabs.