Q & A – Calculating Tax and Gratuity

QUESTION:

If a per person charge for a wedding is $100 do you calculate the 18% gratuity and the 7% tax per person, separately on the $100 and then add them together or do you add the gratuity to the $100 and then pay taxes on that figure? Thank you for your assistance.

Thanks,

Barbara

ANSWER:

Hi, Barbara~

Good question! You will want to calculate the tax after you calculate the per person cost + gratuity. Gratuities are always taxable.

So, in this case, your cost per person is $100 x .18 (gratuity) = $118 x .7 (tax) = $8.26 + $118 for a total cost per person of $126.26.

I hope this makes sense, but if not, please let me know and I can explain it further.

Happy planning!

Sincerely,
Eve-Maridy Rice