Who is responsible for all taxes resulting from the provision of the PMS Solution under the Atwell Suites agreement?
Atwell_Suites Franchise · 2025 FDDAnswer from 2025 FDD Document
- 3.5 Taxes.
All Taxes resulting from the provision of the PMS Solution under this Agreement shall be the responsibility of Hotel.
If IHG or an IHG Affiliate is required to pay any such Taxes or penalties or interest relating thereto, IHG or an IHG Affiliate will provide an invoice for such amounts and Hotel will pay such amounts within thirty (30) days of the date of the invoice.
- 3.6 Withholding Taxes.
If Hotel is required to pay any applicable withholding tax payable to the relevant local tax authorities, Hotel shall (a) pay the applicable PMS Solution fee less the amount of the withholding tax; (b) make such required withholding tax payment to the local tax authorities; (c) within thirty (30) days after the date of payment of any
such withholding tax payment, provide IHG with the original or a certified copy of a receipt evidencing payment thereof to the relevant local tax authority; and (d) take all action reasonably required to enable IHG to obtain any tax credit which may be available to it.
- 3.7 Currency.
All fees charged under this Agreement (including any Taxes) will be calculated based on the currency set forth on the cover page of this Agreement but will be invoiced in the local currency used for the existing payment terms between IHG and Hotel under the Hotel Agreement.
Source: Item 23 — Receipts (FDD pages 99–486)
What This Means (2025 FDD)
According to Atwell Suites' 2025 Franchise Disclosure Document, the hotel is responsible for all taxes resulting from the provision of the PMS (Property Management System) Solution under the franchise agreement. This means that any tax, charge, or fee imposed by a local tax authority related to the PMS Solution is the responsibility of the franchisee.
If IHG (InterContinental Hotels Group) or an IHG affiliate is required to pay any of these taxes, penalties, or interest, they will invoice the hotel for the amounts paid. The Atwell Suites franchisee is then obligated to pay that invoice within thirty days of its date. This ensures that IHG is reimbursed for any tax-related expenses they incur on behalf of the hotel related to the PMS Solution.
The FDD also clarifies the handling of withholding taxes. If the hotel is required to pay withholding taxes to local tax authorities, they must deduct the withholding tax amount from the PMS Solution fee, remit the tax to the authorities, and provide IHG with proof of payment within thirty days. This allows IHG to potentially claim a tax credit. All fees, including taxes, are calculated based on the currency set forth on the cover page of the agreement but will be invoiced in the local currency used for existing payment terms between IHG and the hotel.