What is the Dermani Medspa franchisee's obligation regarding payment of taxes?
Dermani_Medspa Franchise · 2025 FDDAnswer from 2025 FDD Document
"Gross Revenue"– the Gross Revenue of the Franchised Business means all of the dermani MEDSPA®'s revenue generated from the sale of all medical spa and cosmetic services related to skin, cosmetic injectables, laser hair removal treatments, membership fees, and all other products and services offered at or from the dermani MEDSPA®, and all other income of every kind and nature related to, derived from, or originating from the dermani MEDSPA®, whether at retail or wholesale, including off-premises services, mobile clinics, and temporary locations (whether these sales are permitted or not), and proceeds of any business interruption insurance policies, whether any of the products or services are sold for cash, check, or credit, and regardless of collection in the case of check or credit; except that "Gross Revenue" excludes any tips received by any staff or personnel who will provide the actual medical services, clients
customer refunds, discounts from coupon sales, rebates, sales taxes, and/or other taxes collected from customers by you and actually transmitted to the appropriate taxing authorities.
Source: Item 23 — RECEIPTS (FDD pages 66–311)
What This Means (2025 FDD)
According to Dermani Medspa's 2025 Franchise Disclosure Document, franchisees are responsible for collecting and transmitting sales and other taxes to the appropriate taxing authorities. Gross Revenue for a Dermani Medspa excludes sales taxes and/or other taxes collected from customers by you and actually transmitted to the appropriate taxing authorities. This means that franchisees must accurately calculate, collect, and remit these taxes, as they are not considered part of the revenue on which royalties are based.
This obligation has significant implications for Dermani Medspa franchisees. They must implement proper accounting procedures to track and manage sales tax and other tax collections. Failure to accurately collect and remit these taxes can result in penalties, legal issues, and potential damage to the franchisee's reputation. Franchisees may need to invest in accounting software or hire a professional to ensure compliance with all applicable tax laws.
Furthermore, franchisees should stay informed about any changes in tax laws or regulations that could affect their business. Dermani Medspa franchisees should consult with tax advisors to understand their obligations and ensure they are meeting all requirements. This diligent approach to tax management is crucial for the financial health and long-term success of a Dermani Medspa franchise.