Revenue U-turn on waiter tips

A misinterpretation of the law on taxing staff tips means that HM Revenue
& Customs will have to repay millions of pounds in fines.

The tax body has admitted its crackdown on the use of staff-run tips systems,
called troncs, to top up employers salaries to the national minimum wage without
paying national insurance contributions on the tips, was mistaken.

The practice had been banned last year but is now likely to be revived. It is
thought HMRC’s u-turn came after the collapse of the multi-million pound claim
against restaurant group Conran, according to The Daily Telegraph.

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