Setting up on your own for the first time is an exciting time in our professional lives. Leaving behind the shackles of a rigid nine-to-five to follow our dreams is an ambition harboured by many, and a growing number are taking the plunge. One sector where a large number of self-employed people operate is personal training, but personal trainer tax should be a consideration.
With little equipment required, and not to mention the growing popularity of outdoor sessions, a freelance personal trainer can enjoy a great working life. But it’s important to be clued up on the relevant tax considerations, including the types of tax you’ll need to pay, the records you must keep and the expenses you’re eligible to claim back.
How is personal trainer tax calculated?
Self-employed personal trainers will only pay tax on the profits generated during the tax year, with any incurred expenses eligible to be deducted from your declared income. Of course, a lot depends on how you’ve set yourself up.
You may choose to operate as a sole trader, which requires a little less paperwork, but doesn’t offer the same protection of your personal assets should your income suffer. There are also typically fewer tax incentives available to sole traders compared to an individual who sets themselves up as a limited company.
You may establish a formal working relationship with a gym, which would likely include a fee payable to them in order to use their facilities. However, this does not qualify you as an employee of the gym and you will still be required to file a self-assessment personal trainer tax return.
What expenses can I claim?
You can manage your tax burden by ensuring that incurred expenses are accurately and comprehensively recorded.
We recommend using an app like QuickBooks or Xero to stay on top of this process, although a neatly formatted, concise Spreadsheet is a great starting point if you’re just starting up. Record the date, cost and details about the transaction so that you can easily refer back to your records at a later date.
Expenses you can claim against include:
- Fitness studio rent / payments to gym
- Products you sell to your clients)
- Merchandise
- Mileage (not including your commute)
- Marketing costs
- Training equipment
- Accounting costs
In simple terms, if a purchase can be described as wholly, exclusively and necessarily incurred for your business then it can be factored in as an expense.
What types of tax do I need to pay?
We appreciate that there are dozens of considerations when setting up your business, but it’s crucial that you do your homework on personal trainer tax. Spend a little time checking in on upcoming tax deadlines and consider working with an accountant to help you manage your responsibilities.
External support from an expert will free up your time to service clients and grow your business. At Relative, we can introduce automated, efficient processes that use the latest apps to minimise the stress associated with self-assessment.
Get in touch to learn more about how Relative can help get your personal training business hit its stride. Email hello@itsrelative.co.uk or call 01484 441431.