factual

Are sales taxes included in the Gross Revenue calculation for Amorino?

Amorino Franchise · 2025 FDD

Answer from 2025 FDD Document

performed at the Franchised Location or elsewhere, and all other income of every kind and nature related to the Franchised Business, less any authorized discounts (collectively, "Gross Revenue"). Revenue collected from customers in the form of sales tax, federal, state, county, or city taxes, excise tax, or other similar tax collected from customers that you owe to governmental entities must be reported to us, but is excluded from Gross Revenue for the purpose of computing the royalty fee. In addition to taxes, as described in the previous sentence, the following may also be deducted from Gross Revenue: (a) The selling price of any goods returned by customers or the price charged for any services provided to customers to the extent you give any credit, discount, refund or similar allowance but an exchange of merchandise does not result in an exclusion except to the extent of any accompanying credit, discount, refund or other allowance given to the customer; (b) Items returned to their source for credit or other allowance; (c) Amounts or credits received on claims for loss or damage to merchandise or other assets of your Amorino store but not for claims for loss of business under your business interruption insurance; (d) Sales of equipment, trade fixtures or similar property not constituting merchandise of your store; (e) Transfers of merchandise to or from other Amorino facilities when those transfers are made only for the convenient operation of the concerned facilities; (f) gift certificates or similar vouchers until they are redeemed at your store.

Source: Item 22 — CONTRACTS (FDD pages 80–81)

What This Means (2025 FDD)

According to Amorino's 2025 Franchise Disclosure Document, gross revenue for the purpose of computing royalty fees excludes revenue collected from customers in the form of sales tax, federal, state, county, or city taxes, excise tax, or other similar tax collected from customers that you owe to governmental entities. However, these taxes must still be reported to Amorino.

This means that while Amorino franchisees must collect and report sales taxes, these amounts are not factored into the gross revenue upon which royalty fees are calculated. This benefits the franchisee by reducing the base amount used to calculate royalties, potentially lowering the overall royalty payments.

In addition to taxes, Amorino also allows for the deduction of other items from Gross Revenue, including the selling price of returned goods, items returned to their source for credit, amounts received on claims for loss or damage, sales of equipment, transfers of merchandise to other Amorino facilities, and gift certificates until they are redeemed. These deductions provide further opportunities to reduce the gross revenue figure used for royalty calculations.

Disclaimer: This information is extracted from the 2025 Franchise Disclosure Document and is provided for research purposes only. It does not constitute legal or financial advice. Consult with a franchise attorney before making any investment decisions.