When is the Tax indemnity payment due for an Engel & Volkers franchise?
Engel_Volkers Franchise · 2025 FDDAnswer from 2025 FDD Document
| Type of Fee | Amount | Due Date | Remarks |
|---|---|---|---|
| Tax indemnity | You must pay us the amount of any state or local sales, use, gross receipts or similar tax that we may be required to pay on payments which you make to us | On demand | You must pay regardless of whether the tax is imposed directly on us, or required to be withheld by you from amounts due us, or is otherwise required to be collected by you from us. |
Source: Item 6 — OTHER FEES (FDD pages 22–30)
What This Means (2025 FDD)
According to Engel & Volkers' 2025 Franchise Disclosure Document, the tax indemnity payment is due on demand. This means that Engel & Volkers franchisees are responsible for paying any state or local sales, use, gross receipts, or similar taxes that Engel & Volkers is required to pay on the payments franchisees make to them.
The franchisee must make this payment regardless of whether the tax is directly imposed on Engel & Volkers, required to be withheld by the franchisee from amounts due to Engel & Volkers, or otherwise required to be collected by the franchisee from Engel & Volkers. This ensures that Engel & Volkers receives the full amount of the fees owed, without any reduction due to taxes.
This type of tax indemnity clause is relatively common in franchise agreements. It is important for prospective Engel & Volkers franchisees to understand that they are responsible for these tax obligations in addition to the other fees outlined in the FDD. Franchisees should factor these potential tax liabilities into their financial projections and seek professional advice to ensure compliance with all applicable tax laws.