Does Christies International Real Estate charge royalty fees on sales tax?
Christies_International_Real_Estate Franchise · 2025 FDDAnswer from 2025 FDD Document
- Amount. "Gross Revenues" means the aggregate dollar amount from all sales of goods or services made, provided by, or in connection with the Business or the Marks, whether for cash or credit or non-cash payments or consideration at fair market value, regardless of collection in the case of credit, before the deductions of any fees, costs, or expenses you incur. Gross Revenues includes, without limitation the total commissions earned from each transaction before any deductions, including without limitation, MLS fees. By way of example, and not a limitation, in the event your office or one of your agents sells a home with a closing price of $500,000, a commission of 6%, a seller/buyer agent split of 50/50, this sale would generate a gross commission of $15,000.
Source: Item 23 — RECEIPT (FDD pages 54–177)
What This Means (2025 FDD)
The 2025 Franchise Disclosure Document for Christies International Real Estate defines "Gross Revenues" as the basis for calculating royalty fees and other fees. Gross Revenues include the aggregate dollar amount from all sales of goods or services made in connection with the business, whether for cash, credit, or non-cash payments, before any deductions for fees, costs, or expenses.
Specifically, the definition states that Gross Revenue includes the total commissions earned from each transaction before any deductions, including MLS fees. The document provides an example where if an office sells a home for $500,000 with a 6% commission, the "Gross Revenues" for that transaction, upon which Royalty Fees and other fees will be calculated, will be $15,000.
However, the definition of "Gross Revenues" does not explicitly mention whether sales tax is included or excluded. Since the definition states that Gross Revenues are calculated before any deductions of fees, costs, or expenses, it is not clear if sales tax is part of the calculation. A prospective franchisee should seek clarification from Christies International Real Estate on whether sales tax is included in the calculation of Gross Revenues for the purpose of determining royalty fees.