What is the Meals and Rentals Tax? An 8% tax is assessed upon patrons of hotels and restaurants, on rooms and meals costing $.36 or more. An 8% tax is also assessed on motor vehicle rentals. Motor vehicle fees, other than the Motor Vehicle Rental Tax, are administered by the NH Department of Safety (RSA 261). For more information on motor vehicle fees, please contact the NH Department of Safety, Division of Motor Vehicles, 33 Hazen Drive, Concord, NH 03305.

Who pays it? The tax is paid by the consumer and collected by operators of hotels, restaurants, or other businesses providing food service, room rental, and motor vehicle rental.

When is the tax due? The tax is due on the 15th day of the month following the taxable period. Electronic filing, via touch tone telephone and personal computer, are available to Meals and Rentals Operators. A paper return is not required if filing electronically, but operators must retain the meals and rentals worksheet for three years. Approved seasonal operators must file reports for each month of their approved season even if no tax is due

How do I become an approved seasonal operator? Send a request in writing to:

New Hampshire Department of Revenue
Collection Division
PO Box 454
Concord, NH 03302-0454

See Rev 704:04 for guidelines used in the request.

Who do I contact with questions? Call Central Taxpayer Services at (603) 271-2191 or visit the Department at 45 Chenell Drive, Concord, NH.

What records do I need to keep and for how long? Keep all records used to record and report your Meals & Rentals Tax for three (3) years. This includes the  M&R worksheet, cash receipts journals, cash disbursement journal, general ledger, payroll records, cash register tapes, guest checks and registration cards, bank statements with all enclosures and any other source document used in your accounting records. Include those that separate taxable items from non-taxable items. If you sell both taxable and non-taxable items, it is a requirement to maintain those records which justify non-taxable sales.

How are bakery products taxed? All bakery products sold in quantities of less than six from a restaurant are taxable. A bakery is classified as a restaurant when it offers other taxable items for sale such as, but not limited to, coffee, soda, sandwiches, salad bars and/or prepared foods. The taxability of bakery products is not affected by whether the bakery product is served to be eaten on the premise or on a to-go basis.

Establishments known as convenient stores or supermarkets shall not be considered bakeries. See Rev 702.18 (f).

Are gratuities and service charges taxed? Gratuities paid to servers are not taxable. Other service charges are not taxable when the charge is (a) not used as a supplement or in lieu of wages, or for managerial bonuses; (b) the charge is paid to the service personnel providing the service for which the gratuity was charged; (c) the charge is separately stated on the customer's receipt or contract; (d) the charge is usual and customary; and (e) records must be maintained to substantiate the distribution of the gratuity. For more clarification please see TIR 2002-004.

Do I need a separate license for catering? Yes, an additional separate license is required for the occasional serving of meals at various locations for occasions such as but not limited to banquets, weddings, barbecues, outings, picnics, etc.

Are party platters taxable? Even if I am not serving? Yes, party platters are taxable whether delivered, picked up, served or not.

Who is exempt from the Meals & Rentals Tax? No blanket Meals & Rentals Tax exemption exists for non-profit organizations. However, there are limited exemptions for instrumentalities of the state of New Hampshire, the federal government, schools and medical facilities. Please refer to the department's administrative rule Rev 702 for criteria.

If you have any questions about tax exempt sales, please call the department for clarification at 603-271-3400. The State of New Hampshire does not issue Meals & Rentals Tax exempt certificates.

How should I handle coupon and discount sales? The tax should be applied to the sale amount after the discount or coupon reduction has been taken.

When is long term room rental subject to the meals & rentals tax? Tax must be collected on all room rentals of less than 185 days. When a patron reaches the 185th consecutive day of occupancy the operator must refund to the patron the tax monies that have been collected. The operator must then send to the New Hampshire Department of Revenue Administration verification of the refund (a copy of the canceled check or a signed statement from the patron that he/she has received the refund) along with documentation supporting the length of occupancy. The Department will then issue a credit memo. Once the credit memo is received, the operator may use it to reduce a subsequent tax payment. The credit memo amount should be entered on Line 14 of the Meals & Rentals Tax worksheet. NOTE: Operators may not utilize any credit amount until they have received a credit memo from the department.

Are function room rentals taxable? If the function room is located in a hotel or any other facility that has sleeping accommodations, then the rental is subject to the tax.

Where can I get a copy of the Meals & Rentals Tax law and rule? A copy of the Meals & Rentals tax law (RSA 78-A) and Administrative Rule (Chapter 700) is available on this web site. Select here to access the laws and rules page.

Do I need to file a return every month even if I have no activity? Yes, you must file a return even if you have had no activity during your scheduled reporting periods. (see question on seasonal filers)

What charges associated with automobile rentals are taxable? All charges included in the rental agreement are taxable including but not limited to airport fees, drop off fees and under age fees. The following items are not subject to the tax when separately stated in the agreement:
(a) Charges for fuel;
(b) Charges for insurance; and
(c) Charges for damages.

An exception exists for vehicles modified and rented for the transport of disabled individuals. See RSA 78-A:8 (a).

Is alcohol subject to the Meals and Rentals tax? Yes, beer, wine and liquor served by a restaurant are subject to the tax, even if served without food.

Under what conditions is the 3% Timely Filing Commission denied? Operators may take the 3% commission only if they meet all of the following requirements: (1) Keep the prescribed records; (2) File the return timely; (3) Pay the tax due timely; (4) Have no outstanding prior balance due for tax, interest and/or penalties and, (5) Follow the appropriate method of filing (electronic filing is required for all operators having $25,000 or more in taxable revenue in the prior calendar year). Operators required to file electronically, who choose to file paper returns, shall not be allowed to deduct the 3% commission.