As a fitness business owner, it’s important to be aware of the many tax deductions you may be eligible for. From equipment and office expenses to marketing and advertising costs, there are a number of deductions you can take advantage of.
To help you out, we’ve compiled a list of 10 common tax deductions for fitness businesses. Talk with your accountant to learn which of these deductions is best for your business, and keep reading to learn more!
Entertainment and Meals
There are a few different types of entertainment and meals that can be deducted as business expenses for fitness businesses. For example, if you take a client out for lunch or dinner, that expense can be deducted. Similarly, if you take clients to a sporting event or to a show, those expenses can also be deducted.
Of course, not all entertainment and meal expenses can be deducted. For example, if you take a client out for drinks after work, that expense would not be deductible. The same goes for personal meals that are not related to business.
Professional Services
There are a few different types of professional services that can be deducted when filing taxes for a fitness business. These include things like accounting and legal fees. If you hire someone to help with your taxes or to provide legal advice, you can deduct those expenses. You can also deduct the cost of any licenses or permits that you need in order to operate your business. This includes things like business licenses and health club licenses. This also includes the software you use to run your fitness business. If you have to pay any fees to use special equipment or facilities, those costs can also be deducted.
Home Office Expenses
For a fitness business, you may be able to deduct some of your home office expenses. This can include things like the cost of your office furniture, utilities, and insurance. To qualify for this deduction, your home office must be used exclusively for business purposes.
Work Clothing
If you run a fitness business, you may be able to deduct the cost of work clothing from your taxes. This includes clothing that is specifically designed for working out, such as workout clothes and shoes. You can also deduct the cost of uniforms if you require your employees to wear them.
To deduct the cost of work clothing, you will need to keep receipts for any purchases that you make. You will also need to show that the clothing was necessary for your business. For example, if you require your employees to wear uniforms, you will need to show that the uniforms are necessary for their job.
Subscriptions and Memberships
Subscriptions and memberships to fitness-related publications and organizations are deductible. This includes magazines, online newsletters, and membership fees to gyms or other fitness clubs.
Car Expenses or Mileage Deduction
One of the most common deductions for fitness businesses is car expenses. If you use your car for business purposes, you can deduct a portion of the expenses on your taxes. This includes things like gas, maintenance, and insurance. You can either deduct the actual expenses incurred or take a mileage deduction. The mileage deduction is calculated at a rate of $0.58 per mile driven for business purposes.
Start-up Cost
When you first start your fitness business, you may be able to deduct some of the costs of getting it off the ground. This can include things like the cost of renting space, buying equipment, and hiring staff.
Advertising and Marketing may also be deducted from your fitness business. This can include things like the cost of designing and printing flyers, ads in newspapers or magazines, and online advertising.
Other Expenses: There are other expenses that you may be able to deduct as well. This can include things like the cost of insurance, licenses and permits, and accounting services.
Music and Exercise Videos
There are a few common tax deductions for fitness businesses that you may not be aware of. For example, did you know that you can deduct the cost of music and exercise videos used in your business? This includes the cost of buying or renting the videos, as well as any licensing fees you may have paid.
Gym Equipment and Gear
Any gear or machinery utilized solely by your clients counts as a business expense. This might feature common equipment like weights, machines, and mats, but it could also include audio equipment or water-filling stations. You can write off these expenses on your tax return as long as they are used solely by your clients.
Internet Connection/Mobile Plans
The majority of businesses require a phone and internet access to function. Consequently, internet and phone costs related to the business are tax deductible. You can only deduct the portion of time that you spent using these services for business if you used them both for personal and business reasons.
As an added bonus to you, you can also write off any retirement fund contributions. In addition to helping you secure your future, retirement accounts can help you pay less in taxes. You are able to contribute up to 20% of your annual earnings to a self-employed pension individual retirement arrangement (SEP-IRA). The contributions you make to your SEP-IRA accounts are tax deductible.
