HMRC Green Lights Our Tipping Revolution
In an exciting move that will really turbocharge our Tipping Revolution, we have received clearance from HM Revenue & Customs (HMRC), the UK’s tax authority, making TiPJAR the only system of its kind in the UK through which staff can collect and share ‘digital’, or cashless, tips.
This gives businesses the opportunity to dispense with complex and costly ‘tronc’ systems and all the time-consuming frustrations they cause allowing tips to make their way to those who earned them quicker and more transparently. The clearance from HMRC means operators can have confidence that as long as they hand over full control of tip management to the staff via the TiPJAR platform, they should not be responsible for tax or National Insurance contributions on the tips collected and can move away from operating tronc systems in their business.
Through the TiPJAR platform, any tip paid by a customer ‘digitally’ – by card or smartphone – is equivalent to cash and is wholly owned by the staff themselves, completely by-passing the business and, therefore, the need to operate a tronc system. Money given in tips can be available to the teams as quickly as 20 minutes after finishing a shift.
Suitably chuffed with the news, our Founder James Brown, said: “We are delighted that HMRC agree with our view on how modern tipping can work better and work harder for both the employee and the business. We hope this clearance will encourage more companies, and their employees, to drop old fashioned tronc systems, which are a headache to organise, costly to run and lack transparency.
The complexities of the current tronc system are well documented in the hospitality industry and can leave staff waiting months for tips, teams and customers lacking trust in the process and operators facing fines for errors in management of the system.
Simon Bocca, former COO at Fourth and founder of PayCaptain, recently joined our revolution as a Board Director and is equally excited by the new opportunities presented by TiPJAR and this welcome HMRC update:
“What the team have achieved here is game-changing for the UK hospitality industry. They have created a viable option for operators who do not want to pay for, administer and manage a tronc scheme in their business. This is real innovation in the hospitality tech space and a hard-fought result in the face of a lot of sceptics who thought there was no alternative to a traditional tronc system.”
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