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Easy Payroll Processing For Your Restaurant

Whether you're a seasoned restaurateur with multiple locations or just opening your first cafe, our payroll solutions will simplify your business. Restaurant payrolls are governed by a unique set of employment and tax laws that typically do not apply to other industries. As such, it is important to ensure your payroll partner is prepared to protect your business and it's employees.

  • Intuitive online payroll portals
  • Full payroll & tax filing: federal, state & local
  • Employee self service
  • Employee self service
  • FICA Tip Credit Reporting
  • Worker's compensation pay by pay
  • Labor law poster compliance
  • Time keeping & attendance
  • General ledger interface
  • POS system integration
  • New hire reporting
  • Expert customer service
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Restaurant Tax Tips

Reporting Income

The IRS requires employees to report all tips earned to their employer. As an employer, you must ensure that the total tip income reported during any pay period is, at a minimum, equal to 8% of your total receipts for that pay period. Taxable income is governed by the Tax Equity and Fiscal Responsibility Act (TEFRA) and Tip Reporting and Alternative Commitment (TRAC). It is important to note that certain types of "tips" should be treated differently depending on how they are earned.

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The FICA Tip Credit

Federal Insurance Contribution Act (FICA) is a U.S. federal payroll tax that consists of Social Security Tax and Medicare Tax. As discussed in 'Restaurant Tax Tips' section above, tips that your restaurant's employees receive from customers must be recorded as taxable income - this applies to both cash and credit card tips.

A tax credit (different from a tax deduction) is a dollar for dollar reduction of your taxes due. The goal of the FICA Tip Credit is to incentivize restaurant owners to report staff tip earnings. By doing so, the employer will receive a tax credit on FICA taxes paid on wages the exceed the minimum wage! The FICA Tip Credit is reported on IRS Form 8846 and should be filed by your tax accountant when the business tax returns are submitted. While this may be a bit confusing at first read, just know that this is a tremendous benefit for every food establishment that qualifies for the FICA Tip Tax Credit.

You should qualify if you meet both of the following conditions:​

  1. You had employees who received tips from customers for providing, delivering, or serving food or beverages for consumption if tipping of employees for delivering or serving food or beverages is customary.

  2. During the tax year, you paid or incurred employer social security and Medicare taxes on those tips.


We are available for complimentary consultations to discuss how our payroll solutions can simplify your payroll processing and ensure your FICA Tip Credit is reported correctly to your accountant.

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the core functions of Small Business payroll

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Payroll Made Simple

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Additional Considerations for Restaurant Payroll

There are many other considerations that are unique to restaurants that may complicate your ongoing processes and procedures. Some of these challenges are logistical hurdles due to the nature of the business, while others may be due to other federal or state specific regulations. Our knowledgeable team is equipped to advise you on best practices.

A few more items that are frequently encountered in the restaurant space are:​


  1. Various pay rates for each employee (Ie. Some hours worked as a waiter, some as a hostess)
  2. Pay frequency requirements for hourly versus salaried employees
  3. Employees without bank accounts
  4. Pay statement requirement - rules vary by state, but are not required at the federal level
  5. New hire reporting and garnishment payments
If there are additional topics that you are uncertain about, please contact our team of experts!