Tronc Schemes
From Troncmaster Solutions
We are a team of experts who provide Tronc Scheme services for the hospitality, hairdressing, catering, and service sectors. Our goal is to ensure that the tips are calculated and distributed fairly amongst employees, adding this to their pay each period. With our help, employers can rest assured that their employees are paid fairly and that their business is compliant with the latest regulations. Our quotes come with no hidden fees and no long-term commitments - just a straightforward 30-day rolling contract for complete flexibility and peace of mind.
Industries We Serve
In the United Kingdom, the tronc scheme is particularly relevant in industries where tipping and service charges play a significant role in employee income distribution. The hospitality sector, encompassing restaurants, cafes, and bars, is a primary focus for tronc schemes. Within these establishments, tronc systems are commonly implemented to ensure fair and transparent distribution of tips among front-of-house staff, such as waiters, bartenders, and hosts. Additionally, the hotel industry, particularly those with dining facilities, often adopts tronc schemes to appropriately allocate service charges to employees.
A Guide To Tronc Schemes
Looking to better understand how Tronc schemes work? Our helpful guide to Tronc schemes breaks down everything you need to know - from what a Tronc is and how it’s managed, to staying compliant with HMRC regulations. Whether you’re an employer in hospitality or an employee receiving tips, this guide simplifies a complex topic. Download your free copy and take the guesswork out of Tronc management today.
Tronc Scheme FAQ's
2. Who can be a troncmaster?
A troncmaster can be any employee (but not the employer) who is trusted to manage the fair distribution of tips. They must act independently and follow a clear, consistent process.
3. Why use a Tronc scheme?
Tronc schemes help businesses:
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Ensure fair and transparent distribution of tips
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Stay compliant with HMRC guidelines
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Potentially reduce National Insurance (NIC) liability for employers
4. Are tips in a Tronc scheme subject to tax?
Yes. All tips are subject to income tax, whether they’re paid through a Tronc or not. However, if managed correctly, Tronc payments are not subject to National Insurance contributions. Find out more...
5. How should a Tronc be set up?
A Tronc must be registered with HMRC, and the troncmaster must operate PAYE for the distributed amounts. The process should be documented clearly to demonstrate fairness and compliance.
5. How should a Tronc be set up?
A Tronc must be registered with HMRC, and the troncmaster must operate PAYE for the distributed amounts. The process should be documented clearly to demonstrate fairness and compliance.
6. Can employers decide how tips are distributed in a Tronc?
No. In a tronc, while employers can establish the framework for tip distribution (like deciding who becomes the troncmaster or setting general guidelines), they cannot directly decide how tips are allocated among employees. It must be decided independently by the troncmaster and based on a fair and transparent system.
7. Do Tronc payments count toward minimum wage?
No. Tips and gratuities - whether through a Tronc or otherwise - do not count toward the National Minimum Wage or National Living Wage. Employers must pay base wages separately.
8. What are the risks of not running a Tronc scheme properly?
Improper management can lead to:
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HMRC investigations
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Backdated tax and NIC liabilities
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Reputational damage
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Disputes among staff
9. Can Tronc schemes include kitchen or back-of-house staff?
Yes. The troncmaster decides how tips are distributed, and that can include both front-of-house and back-of-house staff -provided the process is fair and consistent.
