What happens if a Caring Transitions franchisee submits their annual income statement late?
Caring_Transitions Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisee shall pay to Franchisor a late fee of $250 for any annual income statement, financial statement, or tax return that is not received by Franchisor within five days after the due date;
- (b) Submit to Franchisor, within ninety (90) days after the end of each calendar year, an income statement for the preceding calendar year, certified by Franchisee or by the Designated Individual as accurately reflecting the results of operations of the franchised business for the preceding calendar year, together with such other information as may be prescribed by Franchisor.
Franchisee shall pay to Franchisor a late fee of $100.00 or 10% of the amount due, whichever is greater, on any payment (including, without limitation, amounts due for Royalties, National Branding Fees, or goods or services provided by the Fund, by Franchisor or any affiliate of Franchisor) that is not received by Franchisor within five days after the due date.
Franchisee shall pay to Franchisor a late fee of $100 for any Revenue Report, tax return, or other Business Record that is not received by Franchisor within five days after the due date.
Any payments that are not received by Franchisor within thirty days after its due date shall bear interest at the rate of 18% per annum, or the highest rate allowed by law, whichever is lower, from the date payment is due to the date payment is received by Franchisor, regardless of any subordinate agreement that may be in effect to postpone payment.
Source: Item 20 — OUTLETS AND FRANCHISEE INFORMATION (FDD pages 41–49)
What This Means (2025 FDD)
According to Caring Transitions' 2025 Franchise Disclosure Document, a franchisee will incur a late fee for submitting their annual income statement past the due date. Specifically, Caring Transitions requires franchisees to submit an income statement for the preceding calendar year within ninety days after the end of each calendar year. This income statement must be certified as accurate. If the income statement, financial statement, or tax return is not received within five days after the due date, the franchisee will be charged a $250 late fee.
In addition to the late fee for the annual income statement, Caring Transitions also stipulates a general late payment policy. If any payment, including royalties or national branding fees, is not received within five days of the due date, the franchisee will pay a late fee of $100 or 10% of the amount due, whichever is greater. Furthermore, a $100 late fee applies to any Revenue Report, tax return, or other Business Record not received within five days after the due date.
Moreover, any payments not received within thirty days after the due date will accrue interest at a rate of 18% per annum, or the highest rate allowed by law, whichever is lower. This interest applies from the date the payment was originally due until the date it is received by Caring Transitions. These financial penalties highlight the importance of timely submissions and payments to maintain good standing with the franchisor and avoid additional costs.