Accountants for Hospitality
Accountants for UK restaurants, bars, cafes and hotels, covering tronc schemes, tips legislation, VAT on food and tight-margin reporting.
How we help
Hospitality runs on thin margins, high staff turnover and two taxes that behave unusually: VAT on food, and the treatment of tips. Both are easy to get wrong at scale, and both are areas HMRC looks at.
Tips, tronc and the law
The Employment (Allocation of Tips) Act 2023 took effect on 1 October 2024 and requires employers to pass on 100% of qualifying tips with no deductions, allocate them fairly and transparently, pay them out by the end of the month following receipt, keep a written tipping policy and retain records workers can request.
Run alongside this, a properly constituted tronc lets tips be shared through an independent troncmaster and can exempt qualifying amounts from National Insurance for both employer and employee, a saving that matters on a large tip pool. The exemption depends entirely on the employer not controlling allocation. See what a tronc scheme is and allocating tips and service charges in hospitality.
VAT on food is not one rate
Hot takeaway food, eat-in, cold food to take away and catering are treated differently, and the boundaries are genuinely awkward, the same item can carry different VAT depending on temperature, premises and how it is sold. Mis-coding across thousands of transactions compounds quickly. Our guide to VAT for restaurants and cafes covers the traps.
Payroll at hospitality scale
High turnover, variable hours, under-18s and students, and National Minimum Wage compliance across age bands make hospitality payroll harder than headcount suggests. Tips cannot be used to reach minimum wage, which is a common and expensive error. We run the payroll, the tronc and the auto-enrolment together so the pieces reconcile, see our payroll service.
Margins, stock and the numbers that matter weekly
Annual accounts are almost useless for running a restaurant. Gross margin by category, wage percentage against sales, stock variance and covers are weekly numbers, and if you are seeing them once a year the decisions have already been made for you. We produce monthly management accounts built around the measures the sector actually uses.
What we do for hospitality
Bookkeeping and VAT coded properly for food and drink, payroll and tronc administration, year-end accounts and weekly or monthly reporting on margin and wage cost.
Frequently asked questions
Do I have to pass on all tips to staff?
Yes. Since 1 October 2024 employers must pass on 100% of qualifying tips with no deductions other than tax, allocate them fairly, and keep a written tipping policy and records.
What is a tronc and do I need one?
A tronc is a separate arrangement for sharing tips, run by an independent troncmaster. It can exempt qualifying payments from National Insurance, but only if the employer does not control allocation.
Can tips count towards the National Minimum Wage?
No. Tips must sit on top of minimum wage, and using them to reach it is a common and costly compliance failure.
What VAT do I charge on food?
It depends on whether the food is hot or cold, eaten in or taken away, and how it is supplied. The boundaries are awkward and mis-coding compounds across thousands of transactions.
Can you handle payroll for a large team with variable hours?
Yes. Variable hours, high turnover, age-banded minimum wage and tronc payments are standard hospitality payroll for us.
How often should I see my numbers?
Weekly or monthly. Gross margin, wage percentage and stock variance drive a hospitality business, and annual accounts arrive far too late to act on them.
Looking for hospitality specialists?
Book a free consultation and we will tell you honestly whether we can improve on what you have.