What taxes are Belocal franchisees responsible for paying related to the service agreement?
Belocal Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisee will be responsible for all sales, use, and excise taxes, and any other similar taxes, duties, and charges of any kind imposed by any federal, state, or local governmental entity on any amounts payable by Franchisee hereunder; provided, that, in no event will Franchisee pay or be responsible for any taxes imposed on, or regarding, N2's income, revenues, gross receipts, personnel, or real or personal property or other assets.
As an independent business, Franchisee is responsible for all tax reporting requirements for Franchisee and Franchisee's employees, contractors, and representatives.
Accordingly, Franchisee and Franchisor agree that Franchisor will not withhold, deduct, or pay income tax, social security, or any other payroll or other taxes or amounts for Franchisee's benefit or for the benefit of any personnel hired or contracted by Franchisee, including but not limited to, officers, directors, managers, employees, contractors, subcontractors, representatives, or agents ("Independent Staff").
Franchisee is solely responsible for filing all tax returns, tax declarations, and tax schedules, and for the payment of all taxes as required by law, including without limitation, local, state, and federal income taxes, Social Security taxes, Medicare taxes, unemployment compensation taxes, and any other federal, state, or local taxes, fees, or withholdings due for Franchisee.
Franchisee is responsible for withholding, accruing, and paying all income, Social Security, Medicare, unemployment compensation taxes, and any other federal, state, or local taxes, fees, or withholdings relating to all Independent Staff, if any, as well as all statutory insurance and other benefits required by law for Franchisee and any Independent Staff and all other benefits promised by Franchisee to any Independent Staff.
Source: Item 22 — CONTRACTS (FDD page 71)
What This Means (2025 FDD)
According to Belocal's 2025 Franchise Disclosure Document, franchisees are responsible for specific taxes related to the service agreement. Belocal franchisees must pay all sales, use, and excise taxes, along with any other similar taxes, duties, and charges. These taxes are imposed by any federal, state, or local governmental entity on any amounts the franchisee pays under the service agreement.
However, Belocal franchisees are not responsible for taxes imposed on or regarding Belocal's income, revenues, gross receipts, personnel, or real or personal property or other assets. This clarifies that the franchisee's tax obligations are limited to the amounts they pay under the service agreement and do not extend to the franchisor's broader financial or operational aspects.
Additionally, as independent businesses, Belocal franchisees are responsible for all tax reporting requirements for themselves and their employees, contractors, and representatives. Belocal will not withhold, deduct, or pay income tax, social security, or any other payroll or other taxes for the franchisee's benefit or for the benefit of any personnel hired or contracted by the franchisee. Franchisees are solely responsible for filing all tax returns, declarations, and schedules, and for the payment of all taxes as required by law, including local, state, and federal income taxes, Social Security taxes, Medicare taxes, unemployment compensation taxes, and any other federal, state, or local taxes, fees, or withholdings due for the franchisee.
Belocal franchisees are also responsible for handling all tax-related obligations for any independent staff they hire, including withholding, accruing, and paying income, Social Security, Medicare, and unemployment compensation taxes, along with any other federal, state, or local taxes, fees, or withholdings. They are also responsible for providing all statutory insurance and other benefits required by law for themselves and their independent staff, as well as any other benefits promised to their staff.