Is the payment of Transfer Taxes by an Eos Worldwide franchisee dependent on any specific actions by Eos Worldwide?
Eos_Worldwide Franchise · 2025 FDDAnswer from 2025 FDD Document
- (a) Unless expressly stated otherwise, each payment to be made to us hereunder shall be free and clear and without deduction for any (i) currency control restrictions, bank charges, fees, duties or other transactional costs or (ii) applicable sales taxes, use taxes, value added taxes (VAT), goods and services taxes (GST), and similar taxes (as defined in Section 12.2(b) that are properly chargeable thereon (in each case, as applicable, "Transfer Taxes"). We will not in any event be liable to withhold or deduct any such amounts or for any claim, loss, damages, costs or payments whatsoever arising in relation to the withholding or deduction of such amounts.
- (b) You are responsible for ascertaining if payments made to us or our affiliates under this Agreement require any withholding or deduction for present or future Transfer Taxes under applicable law, and are also responsible for remitting such Transfer Taxes in a timely manner to the appropriate taxing authority in each respective jurisdiction. If any such Transfer Taxes are payable on our (including our affiliates') supply of any goods or services to you, our fees will be increased to account for any such Transfer Taxes.
- (c) If any amounts payable by you to us are subject to any such withholding taxes as required under applicable law, you shall promptly deliver to us at the time of payment all receipts of applicable governmental authorities for all such taxes withheld or paid. If you or any other person is required by any law or regulation to make any deduction or withholding (on account of a Transfer Tax or otherwise) from any payment for us or our affiliate's account, you shall, at our option, either: (a) together with the payment, pay
- (d) Transfer Taxes are calculated by multiplying the fees payable by you (excluding the amount payable as a Transfer Tax) for the taxable supply of goods or services by the prevailing rate.
- (e) You shall fully and promptly cooperate with and assist us to provide all information and records we may request in connection with any application by us to any taxing authority with respect to Transfer Tax credits, exemptions or refunds available for any withholding or other taxes paid or payable by you.
- (f) If either Franchisee or Franchisor (or any Franchisor affiliate) is required to pay or reimburse the other for the whole or any part of any cost, expense, loss or other amount that the other party has incurred or will incur in connection with this Transfer Tax liability, the amount to be paid or reimbursed is first to be reduced by an amount equal to any input tax credit the other party is entitled to in respect of the cost, expense, or loss and then increased in accordance with pursuant to this Section, as applicable. If we or our affiliates are required to refund to you any amounts paid hereunder, we and our affiliates will not be required to refund that portion of those amounts that were withheld by you in order to comply with any applicable tax law unless and until we or our affiliates receive a refund of those amounts from the applicable taxing authority thereof, and which is directly attributable to those amounts on us or our affiliates' income or with respect to which the period within which the credit may be reduced or disallowed has expired.
- (g) If any uncollected Transfer Tax is or becomes chargeable on any supply of goods or services by us or our affiliates under this Agreement, we shall issue you, or cause to be issued to you, an invoice and you will pay an amount equal to amount equal to such Transfer Tax in addition to the fees for that supply of goods or services (being the fees listed under this Agreement).
Source: Item 23 — RECEIPTS (FDD pages 74–246)
What This Means (2025 FDD)
According to Eos Worldwide's 2025 Franchise Disclosure Document, the payment of Transfer Taxes by a franchisee is influenced by specific actions undertaken by Eos Worldwide. The franchisee is responsible for ascertaining if payments made to Eos Worldwide or its affiliates require any withholding or deduction for present or future Transfer Taxes under applicable law, and are also responsible for remitting such Transfer Taxes in a timely manner to the appropriate taxing authority in each respective jurisdiction. If Transfer Taxes are payable on Eos Worldwide's supply of any goods or services to the franchisee, the fees will be increased to account for such Transfer Taxes.
Furthermore, Eos Worldwide will not be liable to withhold or deduct any such amounts or for any claim, loss, damages, costs or payments whatsoever arising in relation to the withholding or deduction of such amounts. The franchisee must also cooperate with and assist Eos Worldwide to provide all information and records Eos Worldwide may request in connection with any application by them to any taxing authority with respect to Transfer Tax credits, exemptions or refunds available for any withholding or other taxes paid or payable by the franchisee.
In the event that Eos Worldwide or its affiliates are required to pay or reimburse the franchisee for any cost, expense, loss or other amount incurred in connection with Transfer Tax liability, the amount to be paid or reimbursed is first to be reduced by an amount equal to any input tax credit the franchisee is entitled to in respect of the cost, expense, or loss and then increased in accordance with pursuant to this Section, as applicable. If any uncollected Transfer Tax is or becomes chargeable on any supply of goods or services by Eos Worldwide or its affiliates under the Agreement, Eos Worldwide will issue the franchisee an invoice, and the franchisee will pay an amount equal to such Transfer Tax in addition to the fees for that supply of goods or services.
These stipulations highlight the franchisee's responsibility to understand and comply with Transfer Tax obligations, while also outlining how Eos Worldwide will handle these taxes in its financial interactions with the franchisee. It is important for prospective franchisees to fully understand these tax implications and obligations before entering into a franchise agreement with Eos Worldwide.