DoT's (Fire Elf, Heckhound, etc) do NOT gain damage bonuses from your gear (+x% damage). The initial damage on Fire elf gains the bonus, but the "ticks" do not.
Since an enemy's resistance REDUCES the damage on the ticks of these spells, I am baffled why damage increases do not add to the damage. (blades add to the "tick" damage just fine)
It's probably a bug, but it's one that on net makes the game easier. You really only use damage over time spells against mobs that have a shield against your damage type, and those mobs tend to be extra vulnerable to your damage type. A damage over time spell clears the shields, and then subsequent damage pulses have the mob vulnerability count double, as what the glitch does is refer to the mob's resistance rather than your damage bonus.