Theft = More Taxes

Most restaurateurs know they lose the cost of the pilfered product, but few understand that they may be responsible for the sales and income taxes (plus penalties and interest) that would have been incurred had the stolen product been sold.  Significant tax liabilities often arise from sales (and income) tax audits of restaurants and bars.  This can occur anytime purchased wine, beer and liquor is not sold, and one of the most common (and largest) causes of these items not being sold is theft and fraud.

On my sister blog, Canadian Restaurateur, I have started a series of posts on theft and fraud in restaurants and bars.   Rational restaurateurs will only invest as much time and money as they expect to save, in terms of reducing theft and fraud.  The problem is that restaurateurs are seriously underestimating the cost of theft, by forgetting the tax consequences.  Consequently, they put much less effort, and invest less, in theft and fraud prevention.  I’ve written about this before, in The True Cost of Staff Theft.

To help protect your operation from potentially crippling tax liabilities, I recommend reading these posts on my Canadian Restaurateur blog.

In Restaurant Theft Findings, I write about some very interesting findings in a study about restaurant and bar theft.  Even I was surprised about the extent of employee theft!  I make note of a couple of common methods of reducing theft that don’t work and two others that do.

In Restaurant Fraud & Theft – Part I, I review several important fraud and theft techniques related to purchasing, receiving and inventory safeguarding.  Many of these kinds of theft are often overlooked by restaurateurs.

This should be enough to get started.  Subsequent posts will examine some of the more common thefts.

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