Sales by Caterers
Caterers sell and serve meals and drinks on premises designated by a purchaser. Charges by a caterer to prepare, serve, and deliver the following taxable products are subject to Wisconsin sales and use tax:
- Prepared food 1
- Soft drinks
- Dietary supplements
- Alcoholic beverages
Most sales by a caterer are prepared food. A caterer may charge a customer a price per plate, meal, or type of service, or a lump sum. The method used to charge the customer does not affect the tax treatment of the caterer's sales.2
Example 1: Caterer is hired to provide meals and beverages to 250 guests at a wedding dinner for $18 per plate. Caterer prepares and serves the meals and beverages to guests on or in plates, bowls or glasses. The entire $4,500 charge by Caterer is subject to Wisconsin sales tax. The food and beverages are prepared food because plates, bowls, and glasses (i.e., utensils) are provided with the sale of the food and beverages. The charge is taxable regardless of who owns the plates, bowls, and glasses for serving.
Example 2: Same as Example 1, except meals are provided self-serve, buffet style. The charge by Caterer for preparing food and beverages for 250 guests is $3,000. The entire $3,000 charge by Caterer is subject to Wisconsin sales tax. The food and beverages are prepared food since plates, bowls, and glasses necessary to receive the food and beverages are available to the purchaser's guests.
Example 3: Caterer is hired to provide lunch to Company's employees participating in a golf outing for $500. Under the agreement between Caterer and Company, Caterer provides each golfer a "to go" box that contains a sandwich, bag of potato chips, cookie, and a napkin. The $500 charge by Caterer to Company is subject to Wisconsin sales tax. The lunches are prepared food because Caterer physically gives a napkin to the purchaser (i.e., Company's employees) with the "to go" box. Note: Even if the napkin was not given, the lunches are prepared food since two or more food ingredients are combined and sold by Caterer as a single item.
Example 4: Cake Decorator is hired to prepare, cut, and serve wedding cake for 200 guests for a fee of $350. The $350 charge by Cake Decorator is subject to Wisconsin sales tax. The wedding cake is prepared food because plates are provided with the wedding cake. The charge is taxable regardless of who owns the plates for serving.
Example 5: Same as Example 4, except Cake Decorator prepares and delivers the wedding cake but does not serve it to the purchaser's guests. Cake Decorator charges the purchaser $200 for the wedding cake and delivery. The purchaser has a separate agreement with the wedding venue to have the venue's employees cut and serve the wedding cake on plates. The $200 charge by Cake Decorator is not subject to Wisconsin sales tax. The wedding cake is not prepared food since the cake is a bakery item and utensils are not provided or made available to the purchaser at the time of sale.
Purchases by Caterers
Food and Food Ingredients, Including Beverages - Purchases of certain food and food ingredients (e.g., potato chips, meats, soup mixes) and beverages (e.g., milk) by a caterer are exempt from tax. The caterer is not required to provide the supplier an exemption certificate when purchasing these items.3
Items For Resale - Purchases of certain food and food ingredients (e.g., candy, potato salad that is prepared food) and beverages (e.g., soft drinks, beer) that a caterer resells may be purchased without tax. The caterer is required to provide the supplier with a fully completed exemption certificate, claiming resale.3
Preparation and Serving Equipment -
- Purchases of non-disposable items (e.g., silverware, tablecloths, pots) used by a caterer to prepare, transport, and serve meals are subject to Wisconsin sales and use tax.4
- Certain packaging and shipping materials used by a caterer to transfer merchandise to its customer are exempt from Wisconsin sales and use tax. In addition, packaging and shipping materials used by a caterer in packing, packaging, or shipping meat or meat products are exempt, regardless of whether these items are used to transfer merchandise to customers. For example, a caterer's purchase of "to go" boxes are exempt, since they are used to transfer merchandise to customers. For additional examples, see Part IV.D. of Publication 220, Grocers.
- Purchases of disposable items (e.g., tablecloths, napkins, straws) by caterers which are provided to customers with the required purchase of taxable products (i.e., alcoholic beverages, prepared food) are not subject to Wisconsin sales or use tax. The caterer is reselling the disposable items, even if the caterer does not separately charge the customer for the disposable items. The caterer is required to provide the supplier with a fully completed exemption certificate, claiming resale.4
1 Information on prepared food is provided in Part II.D. and Appendix I of Publication 220, Grocers, and in Part III.A.3. of Publication 236, Restaurants and Bars.
2 More information is provided in Part III.C. of Publication 220, Grocers.
3 More information on taxable and exempt food and food ingredients is provided in Part III.A.1. of Publication 220, Grocers.
4 More information on purchases by caterers is provided in Part III.C.2. of Publication 220, Grocers.
May 10, 2016
Updates were made to the code or formatting on this page as of May 10, 2016. This date does not reflect the effective date or any other date relating to the content of this page.