Visa's no-show rules don't cover a New Year's Eve dinner

It's the first of November, the New Year's Eve menu is written, and the owner wants the book open by Monday. The menu took a month. The question that decides whether the night makes money takes about ten minutes, and it usually gets skipped: how do you take the guest's money, and when can they get it back?

There are three answers in use: a prepaid ticket, a deposit, or a card held against a no-show fee. They look interchangeable on a booking page. Under the card rules, the fee rules and the tax rules, they aren't. None of this is legal or tax advice; it's what the published rules say.

Three ways restaurants sold the night

Here's how four restaurants published their New Year's Eve terms. These are individual pages, not industry norms, but between them they cover every option.

In this small sample, the prepaid and deposit restaurants published their refund terms and the card-hold restaurant didn't. That missing line is the problem.

A held card is not a guaranteed reservation

Hotels can hold a card and charge a no-show. That's Visa's "Guaranteed Reservation," and the Visa Core Rules (October 2026 edition, section 5.8.8.2) limit it to lodging, trailer parks and campgrounds, and rentals of aircraft, bicycles, boats, equipment, motor homes, motorcycles and vehicles. Restaurants aren't on the list.

So when a restaurant charges a held card on January 1, it isn't using a no-show framework Visa recognizes. It's relying on whatever the guest agreed to when they booked, and on Visa's stored-credential consent rules, which I'd expect to be harder to defend in a dispute than a prepayment the guest agreed to at checkout. I found no published data comparing dispute rates for the two. The deposit chargebacks post covers why charging a card on file after a late cancellation goes badly.

Card holds still have a place on an ordinary Saturday, where the no-shows post ranks them against reminders and deposits. For context, resOS's no-show index (3,768,761 reservations at 2,417 restaurants, August 2025 to July 2026) put the US no-show rate at 3.17%. Across the whole index, restaurants with payment or no-show protection ran 0.80% against 2.47% without. That's vendor data, not proof the protection caused the gap.

A ticket is an advance payment with a dated cutoff

Visa calls a prepaid ticket an Advance Payment: part or all of the price of something you deliver later. Before you charge one, you need the guest's express informed consent to the description, the total price and the refund policy, including "the date that any cancellation privileges expire without Advance Payment forfeiture."

One wrinkle: the same rules (Table 5-20) let only certain merchant categories take the entire price in advance: travel and entertainment (airlines, cruise lines, lodging, rail, travel agencies, car rental), custom goods or services, and a few others. Restaurants aren't named, though Resy and OpenTable both sell prepaid dinners. A deposit, a partial Advance Payment, carries no such limit, so ask your processor how it classifies a full prepaid dinner.

Two more things follow. First, "72 hours notice" doesn't give the guest a date, and Visa asks for one. On New Year's Eve, for a 7 p.m. seating, that's 7 p.m. on Monday, December 28, and I'd print exactly that. Visa's receipt rules (Table 5-33) want that date and time on the receipt too, plus the word "Prepayment" or "Advance Payment" on a full prepayment. Second, "non-refundable" doesn't end the conversation. Visa still runs a dispute for cancelled services (Dispute Condition 13.7), and a merchant "must refund the full amount paid if the Merchant has not adhered to the terms" it disclosed. What protects you is the consent you collected at checkout.

J.C. Holdway's version is the cleanest I found: the cutoff is the moment of booking, it says so, and the guest sees $234 plus tax, not $195, before paying.

What the platforms take

The booking platform is the second cost of a prepaid night, and card processing sits on top of it everywhere. Prices below are as the platforms published them in November 2026.

Resy's plans page says standard card processing fees apply on top. The OpenTable figure comes from Philadelphia Inquirer reporting in January 2026, which said the charge reached most US restaurants in the second half of 2025. I couldn't get OpenTable's own fee schedule to load.

On an 80-cover night at $195 a ticket, that's $15,600 in prepayments. Three percent is $468 and two percent is $312, before card fees. Eventbrite's service fee on the same 80 tickets is about $720, plus processing. A ticketing site costs more per seat, but by default the guest pays it. That's a pricing decision, and it runs straight into the fee rules.

Fee rules: all-in prices for shows, disclosure for dinners

The FTC rule is about shows. The FTC's fee rule (16 CFR Part 464, in force since May 12, 2025) covers two things: live-event tickets and short-term lodging. The rule doesn't define a live-event ticket. The FTC's FAQ says "Live-event tickets are for concerts, sporting events, music, theater, and other live performances that audiences watch as they occur," and never mentions restaurants. The final rule's preamble says outright that the rule "does not apply to restaurants"; the FTC had proposed an economy-wide rule, and the National Restaurant Association was among the commenters urging it to leave restaurants out.

A dinner-only prix fixe is very likely outside it. A ticketed party built around a band or a show is untested, and I found no regulator statement on which side it falls. If you're in, the total price has to be the most prominent price on the page, though government charges like tax can sit outside it. The conservative choice for a show night is to advertise the all-in price as the headline.

California exempts restaurants, on one condition. SB 1524, in effect since July 1, 2024, undid the early reading of SB 478 that restaurants had to fold service charges into menu prices. Restaurant mandatory fees are exempt if they're "clearly and conspicuously displayed wherever prices are shown," in the words of the California Attorney General's guidance. The statute extends the same exemption to banquet and catering menus and contracts that fully disclose the terms, which is the version most of my readers will use. The same guidance says SB 478 still covers event tickets, and doesn't say whether a restaurant's New Year's Eve ticket is a menu item or an event ticket. If you sell it as a ticket, on a ticketing site, I'd price it as one: one all-in number.

Other states want the service charge disclosed, or built in. According to a December 2025 Ogletree Deakins recap, Colorado's deceptive-pricing law (HB25-1090) requires restaurants from January 1, 2026 to disclose that a mandatory service charge exists, how much it is and what it pays for. Massachusetts regulations in effect since September 2, 2025 require mandatory fees, service charges included, in the first advertised price, and Florida's operations-charge disclosure rule (section 509.214) took effect July 1, 2026.

Sales tax follows the dinner, not the word "ticket"

Calling it a ticket doesn't take it out of meal tax. New York's regulation on cabaret and roof-garden charges uses a New Year's Eve party as one of its examples: a hotel charging $25 a person for dinner, music and dancing. "The charge of $25 is subject to tax." An Illinois Department of Revenue letter from 2012, which isn't binding, says an admission ticket that includes food or drink is taxable. A 1985 California CDTFA annotation splits a single dinner-and-show price between meal and show the way it splits a hotel rate that includes meals.

Whether the 20% service charge on the ticket is taxable is its own question; the private dining post covers why California taxes a mandatory service charge even when staff get all of it.

A prepaid ticket also arrives weeks before the meal. Your POS has to tie each ticket to its seating so the sale isn't counted twice when the check closes, and the tax and service charge land on the right lines. Check how it redeems platform prepayments before December 31, not after.

What I'm not going to give you

A New Year's Eve no-show rate. The figure that gets repeated is 40%, from a 2007 Kellogg Insight article that cites no data for it. resOS's index has no holiday breakdown. I found no measured NYE rate anywhere.

Tock's per-ticket event fee. Tock's own pricing page wouldn't open for me, and the figures on third-party blogs don't hold up.

SevenRooms' prepayment fees. It publishes none.

Mastercard's version of the no-show rule. I read Visa's rulebook; I didn't check Mastercard's, so don't assume it matches.

What to do

1. Take the money up front, not a card hold. Visa's no-show framework doesn't cover restaurants. A deposit is the cleanest fit under Visa's Advance Payment rules; if you take the full price, confirm with your processor that it allows it.
2. Print the refund cutoff as a date and time on the booking page, the confirmation and the receipt, and get a checkbox on it.
3. Price the platform fee in before you decide who pays it: 2–3% on the restaurant side, or Eventbrite's fee on the guest's.
4. Show the all-in price, service charge included, next to the ticket price before the guest pays.
5. Treat a show night as a live event and lead with one total.
6. Assume the ticket is taxable as a meal until your state says otherwise.

Disclosure: I work at Katalyst, which sells restaurant POS and catering software that takes deposits. What protects New Year's Eve isn't the software. It's the refund date printed on the ticket, and that one's yours to pick.

Related Katalyst products

• Explore Katalyst catering management
• See Katalyst Payments
• See Katalyst reservations