Can Basecamp Fitness profit from administrative surcharges or processing of taxes and fees?
Basecamp_Fitness Franchise · 2025 FDDAnswer from 2025 FDD Document
ising which is separate from the advertising fund described below. Other revenue is recognized monthly when the Company bills the franchisee or when services are rendered.
(in thousands of US dollars)
Disaggregation of Revenues
Current accounting standards require that companies disaggregate revenue from contracts with customers into categories that depict how the nature, amount, timing, and uncertainty of revenue and cash flows are affected by economic factors. The Company has included its revenues disaggregated in its consolidated statements of comprehensive income to satisfy this requirement.
Taxes Collected and Remitted to Government Authorities
The Company may be required to collect and remit taxes on taxable transactions from customers related to certain taxing authorities based on a percentage of revenue.
Source: Item 23 — RECEIPTS (FDD pages 62–248)
What This Means (2025 FDD)
According to Basecamp Fitness's 2025 Franchise Disclosure Document, the company's revenues do not include taxes collected from customers. Basecamp Fitness acts as a collection agent for certain taxing authorities and remits taxes based on a percentage of revenue. These taxes are recorded in accrued expenses and other current liabilities on the consolidated balance sheets, not as revenue. This means that Basecamp Fitness does not profit from the collection or processing of these taxes.
Additionally, the FDD mentions "health insurance reimbursement processing fees" as part of "Other Revenues." These revenues are recognized monthly when Basecamp Fitness bills the franchisee or when services are rendered. This indicates that Basecamp Fitness can generate revenue from processing health insurance reimbursements, which could be considered a form of administrative surcharge for those specific services.
In summary, while Basecamp Fitness does not profit from standard tax collection and remittance, it does appear to generate revenue from specific administrative services like health insurance reimbursement processing. A prospective franchisee should clarify with Basecamp Fitness the exact nature and scope of these administrative services and the associated fees.