Does one serve sherry at formal tea?

No, sherry is not usually served at a formal tea. Tea, along with coffee in the U.S., are most often offered at a formal tea. If children, or young girls are present, I will offer punch or lemonade too.

Keeping in mind that the tastes of one's guests is foremost, if someone requested sherry, and I had it on hand, I would obligingly pour them some and offer it to others. Keeping in mind also that one should never ask that something extra be provided by a host or hostess than is what is already offered, I myself would never request that a host or hostess go to any extra trouble on my behalf.

That all being said... if it is a family, cultural, or regional tradition that sherry be served at a formal tea, then one can feel free to imbibe if one chooses, and not question the tradition or mention that it is not the norm.