New Hampshire Meals and Rooms Tax and tipped wages for restaurants

New Hampshire is known as a state with no general sales tax and no tax on wages, but restaurants do not escape tax entirely. The state charges a Meals and Rooms Tax on prepared food and drink, and the business collects it from the customer and sends it to the Department of Revenue Administration. The Department of Revenue Administration's 2026 booklet lists the rate at 8.5 percent, and the department says it was cut from 9 percent on October 1, 2021. A register that still uses the old rate under-collects, and the business is liable for the difference.

What is the New Hampshire Meals and Rooms Tax?

The Meals and Rooms Tax is a state tax on restaurant meals and on hotel and motel rooms. For a food business, it applies to meals and drinks sold for immediate consumption, whether eaten in or taken out. Reports on the 2021 rate change note that it applies to alcohol served at bars and restaurants, with or without food. It does not apply to groceries, which are not taxed in New Hampshire, although the line between a grocery and a prepared meal can need care if you run a deli counter or a bakery with seating.

The rate is the same across the state. Unlike Massachusetts or New York, New Hampshire does not add local taxes, so you only need one rate for your register.

How is the tax collected and filed?

You collect the tax from the customer at the time of the sale and show it on the receipt. You then file returns with the Department of Revenue Administration and send the tax you collected. Businesses must register with the department before they begin selling. Filing frequency is set when you register, and returns are due on a set schedule, with penalties for late filing. The department publishes forms and guidance on its website, and reminded operators in 2021 that point-of-sale systems had to be updated for the new rate.

Collected tax is not your money. Many owners keep it in a separate account so it is not spent before the return is due.

What items are taxable?

In general, the following are taxable:

1. Meals eaten in the restaurant.
2. Takeout and delivery meals.
3. Alcoholic drinks served in a restaurant or bar.
4. Catered meals and event meals, including any charges that are part of the price.
5. Required service charges or fees that form part of what the customer must pay.

Confirm the treatment of mandatory service charges, delivery fees and gratuities with the department's guidance, since the rules turn on whether the customer has a choice. A voluntary tip left by the customer is generally not part of the taxed price.

How do you set up the register?

1. Set the tax at 8.5 percent for all meals and drinks.
2. Mark grocery items, such as packaged goods, as non-taxable if they qualify.
3. Make sure that online orders, delivery orders and catering invoices use the same rate.
4. Print the tax as its own line on receipts.
5. Review the setup whenever the legislature changes the rate. The rate has moved in the past, and budgets can change it again.

Test your setup with a few sample orders after any system update.

How do tipped wages work in New Hampshire?

New Hampshire's state minimum wage is the same as the federal minimum, which is 7.25 dollars an hour. The state allows employers to pay tipped employees a lower cash wage, set as a percentage of the minimum, with tips making up the difference. Compliance sites for 2026 list the cash wage for tipped employees as 3.27 dollars an hour, which is 45 percent of the minimum. If a tipped employee's tips do not bring the pay up to the full minimum for the hours worked, the employer must pay the shortfall. Check the Department of Labor for the current figures and the exact rules before you set payroll.

Employers cannot keep any part of employees' tips. Keep records of tips and hours, and give staff clear information about how any tip pool works.

Does the lack of sales tax mean lower prices?

It makes shopping cheaper for customers who cross from Massachusetts, but not at the restaurant, where the Meals and Rooms Tax applies. Border towns like Nashua and Salem, and the seacoast around Portsmouth, draw diners from Massachusetts and Maine, and restaurants there compete on price with their neighbors. The tax means a customer pays 8.5 percent over the menu price. Some New Hampshire restaurants display tax-inclusive prices for items like coffee or lunch specials, which can reduce confusion at the register.

What about gift cards, deposits and catering?

Gift cards are generally not taxed when sold, and the tax applies when the card is used. A deposit for a private event is a liability until the event, and the tax applies to the final bill. Catering to an office or an event is taxed as a meal, including delivery and setup charges that are part of the price. Ask the department if your situation has unusual facts. See our guide to state gift card laws for how New Hampshire treats expiration.

What are the common mistakes?

• Using the old 9 percent rate in a system that was not updated.
• Treating a mandatory service charge as a tip and leaving it untaxed.
• Forgetting to register a second location or a new food truck.
• Paying tax from the operating account without a separate account for it.
• Not keeping records that tie the sales reports to the returns.

What should you do now?

Check your register's rate. Read the Department of Revenue Administration's current guidance on meals. Confirm your filing schedule and put the due dates in your calendar. If you hire, check the tipped wage rules with the Department of Labor. This guide is general information, not tax or legal advice.

More guides for your business:

• Planning a New Hampshire restaurant around foliage, ski and summer seasons
• New Hampshire food service license and certified food manager rules
• New Hampshire liquor license for restaurants and the 2026 delivery license

More in the US guides for food businesses.