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Finance Tip -
Putting home expenses on the business accounts
Any profit you
make in your personal training business is subject to Class 4 NIC at the
end of the financial year, which means you have to pay 8% of the profit to
HM Revenue and Customs. You probably run your PT business from home - that
is do your accounts, organise your client records, your diary etc., and
therefore, you can claim some of your household expenses on your
business accounts.
Some people get
concerned that this could result in part if your house being chargeable
for Capital Gains Tax when you move. This however is not necessarily
the case. Capital Gains Tax would only be payable if part of your house is
used exclusively for business with no personal use at all. So as
long as your rooms have some personal use, then there is no problem!
So, how do you
go about it. First of all, anything that you buy primarily for business
can be completely paid for and claimed as an expense against the
business. This includes computers, printers etc. – even if you have some
personal use of these; internet access – if you use the internet for
researching health & fitness, looking up exercise programs, nutritional
information etc., or for sending emails to your clients equipment -
anything you buy and have a primarily business use for.
You can however,
also claim a proportion of your household costs against the business. You
will need to work out how much of your house is used for business tasks,
and from there you can calculate a reasonable amount of household costs to
assign to the business. Here’s an example:
Personal trainer
Simon, does all his paperwork from home in the spare bedroom, and also has
a treadmill in his conservatory that he sometimes has clients in to use.
He has a 2 bedroom house, with a lounge/diner plus the conservatory so has
4 rooms in total excluding kitchen/bathrooms. Of the 4, 2 are used half
the time for business. This means that ½ of his rooms are used for ½ of
the time, so he can claim ¼ of all household expenses against the
business.
The monthly
household expenses include the mortgage 600, gas/elec 60, rates 120,
water 100, phone 30, house insurance 15 giving a total of 925 per month.
Therefore, Simon claims ¼ of £925 = £231 against the business each month,
or £2772 a year, giving a tax saving of around £250.
Marketing Tip
– Getting free publicity
 With
Christmas approaching, many larger charities often run high-value raffles
and auctions to support their cause. This is a great opportunity for you
to help a local charity by donating a valuable prize – perhaps a month
worth of personal training or something similar to go into their raffle.
They will be generating their own publicity anyway, but make sure the
local press etc know about your donation. You’ll also have a month to
convert a new client!
Another way to get free publicity is to do
a mini customer survey and include some controversial questions. Write
articles about the results of the survey. The media loves survey results!
Alternatively, tie your business in with holidays or special days. For
example, tell the local press how your massage therapy business helps to
reduce stress during the Christmas season and provides gift certificates
for welcome relief.
Money Saving
Tip – Become an affiliate
There are all sorts of reasons why having even the most basic web site is
a good idea, but one of the best is becoming an affiliate for
products you would be buying anyway, and being able to get them at a
substantial discount.
An Affiliate Program is a way for companies to advertise on websites other
than their own. If you have a website you can make money doing this. You
get paid on commission - it doesn't cost you to join, and if anyone buys
via links on your website, you make money! If it’s only you who buys
anything, you get a percentage of the sale cost back, so actually get your
products at a lower cost.
So you might decide to set up a link to a company that sells supplements
because you use these yourself. If you spend say £30 you would get part of
that back in commission – typically about 20%, so would get £6 off your
vitamins!
Similarly if you buy books regularly, put a link to Amazon on your web
site, and click there before you buy. You will get a commission for the
sale and so effectively reduce your own purchase price.
There are all sorts of affiliate programs on the web, and places to find
them. One option is www.affiliatefutures.co.uk which has hundreds of very
respectable sellers that you can choose from. Commissions range from
5-35% of the value of the product.
New Client
Tip –Forming alliances
Teaming up with other businesses is a fast and cheap way to grow your own
business. Think about it – getting new clients can be expensive and take
time, but there may be other businesses that already have the very clients
you are aiming for. And as long as you are not in competition with them
then it should benefit you both. You could form alliances with people like
a local slimming club, and perhaps offer special or group discounts; or
businesses like a beauty therapist, complimentary practitioner or a
nutritionist.
You might just have each others fliers and business cards available or you
could send letters to your clients introducing and recommending their
service. There may be no money involved or you may choose to offer a
referral fee as an incentive, so for everyone who books a personal
training session you give the other business a £5 or £10 fee.
Identify a business that you think you could form an alliance with and if
you know them personally, ask them for a chance to get together. Chat it
through and see their response. If you don’t know them personally, start
with a letter and follow up with a phone call and if they seem interested,
arrange to meet and talk through the details.
Weight loss
news – Lose weight & tackle chronic illness
Scientists claim to have discovered a new diet that not only ensures
weight loss but also tackles diseases and could even prolong life. Doctors
from Stanford and New Orleans Universities who have been testing the diet
for 3 years, say it can have health benefits on diverse conditions ranging
from asthma to heart disease.
The diet involves eating normally one day then cutting food intake the
next day to between 20 and 50%. Improvements have been noted within two
weeks of starting, including conditions such as insulin resistance,
asthma, seasonal allergies, rheumatoid arthritis, infectious diseases,
periodontal disease,multiple sclerosis and cardiac arrhythmias.
For people who want to lose weight the diet has the psychological
advantage of not subjecting followers to permanent food deprivation. This
alternate day calorie restriction appears to have health promoting effects
as well as weight loss effects.
Client
retention tips – Loyalty schemes
Customer loyalty
schemes aren’t just for the likes of Tesco and Boots! You can increase
your customer loyalty and encourage clients to stay for longer, but using
ideas designed to provide them with a special incentive. These could
include –
Discounts for
bulk purchases – buy 10 PT sessions, get 2 free.
Discounts for
repeat purchases – offer a monthly rather than an individual session
charge that reflects a discounted price.
Free gifts when
bookings made over a specified amount eg free Swiss Ball, free hand
weights etc.
Newsletters or
useful information updates
Competitions or
events – have a pampering day each month for clients who train for a
certain number of days each month.
Exercise News
– ‘Go’ for girls
The FIA (Fitness Industry Association) has launched a new initiative
called ‘go’ this September, aimed specifically at getting teenage girls
to be more active and stay that way into adult life. Research shows that
teenage girls prefer non-competitive exercise which is why ‘go’ has been
designed to be inclusive, fun and interesting regardless of sporting
ability. The program ties local schools up with FIA members to offer
girls a wide range of activities. For more information, go to the FIA
site on www.fia.org.uk.
New
Product/Service Ideas – The Vew-Do Board
The Vew-Do
board looks like a skateboard without wheels and is the latest product for
balance, cardio, co-ordination and strength. It looks fun and funky and
has great appeal for young people and children. Vew-Do is great for core
fitness training giving strong abs, better posture and long, lean muscles.
Vew-Do allows you to incorporate balance with effective torso strength
training for a dynamic work out.
According to their web site (http://www.vew-do.co.uk)
“Unlike many training exercises balance boarding is fun and produces
amazing results. Using a Vew-Do board will significantly improve your
balance. Stand on it while doing squats, push-ups, or other exercises to
really challenge yourself.” Boards start from around £79.
Business
Management Tip – Get the best bank account
First
of all, if you do not currently have a separate bank account for your PT
business, then you should consider getting one now. Government
regulations mean that banks must offer small businesses like yours, either
free banking or interest on accounts, so bear this in mind.
Also,
make sure that you shop around for the best bank account. The main
high street banks do not always offer the best rates and services for
smaller businesses. Consider the smaller banks as well as the big high
street names. For a website that take some of the hard work out of the
task of comparing banking charges, see
www.moneyfactsonline.co.uk/mfBAF/root.asp.
Training and
Development – Vertical Dance Courses
Focus
Training have teemed up with one of the worlds leading expert on vertical
dance
(also
known as pole dancing) to bring this new course. Designed for those with
an existing Exercise to Music Level 2 qualification, this is the UKs first
accredited qualification for vertical dance and has 24 pending points from
REPS. So if you fancy offering a new & different type of exercise class,
this might be for you! (www.focus-training.com)
Market Ideas
– Women Only
According to Franchise Direct, there has been a marked increase in the
demand for women-only fitness facilities over the last few years. Booming
obesity levels coupled with a dieting culture has contributed to this.
“Women are working in higher paid jobs and are staying single for longer,
which means they have more time for fitness.” Women want to feel
comfortable whilst exercising, and for many this means a female only
environment in preferable. So why not offer women-only running groups –
from experience these are definitely far less competitive & supportive! Or
women-only circuit training, weight training etc.
Nutrition
News –Keep the coffee
 Everyone
embarking on a health and fitness plan seems to think giving up coffee has
to be part of the plan. Is this right? Well actually it’s now widely
accepted that moderate consumption of coffee (4/5 cups a day) is perfectly
safe for most people. In fact, studies show that drinking coffee before
exercise can increase stamina in numerous endurance events. (In 2004
caffeine was removed from the IOC list of banned substances) Caffeine
doesn’t cause dehydration as previously suggested, unless taken in
excessive amounts, and is a great dietary source of antioxidants. So if
you like a cup of coffee, stick with it, it’s good for you!
Health News –
Our food is bad for our brains!
Poor diets have been blamed fro a significant rise in the incidence of
mental ill health in the UK over the past half century. Mental health
charities have warned there is growing scientific evidence of a link
between current poor diets and pathologies such as attention deficit
disorder, schizophrenia, depression and Alzheimer’s. Modern farming has
altered the body fat composition of animals farmed for meet, which has
contributed to a steep decline in nutrients, particularly the Omega 3
fatty acids. PTs with a particular interest in nutrition could consider
offering services to these groups that focus on diet optimization.
Internet
Review
http://www.forbes.com/2006/01/17/cx_sy_0118featslide.html?thisSpeed=35000
– the hottest fitness trends sweeping the US this year – be one of the
first involved!
www.entertrials.co.uk
–
Clinical trials volunteering site. Tens of millions of people are saved
from certain death each year by medication available today as a result of
strictly-regulated clinical trials. Without ‘healthy’ volunteers, many
people around the world would never benefit from medical breakthroughs.
This is your chance to make a real difference - and get paid in the
process.
www.lesscholesterol.co.uk
–
got a client with high cholesterol issues? This site gives lots of useful
advice.
www.uksportimports.com
– good quality sports equipment at reasonable prices
www.quotes.healthinsurancegroup.co.uk
– Have you got health insurance? PTs need some reassurance if they get
injuries or illness, and this site offers the best options.
Tax Tip –
Gifts to Customers
Keeping clients happy not only ensures they stay clients for a long time,
but also encourages them to tell their friends about you, and potentially
brings in new clients. Giving small gifts can be a nice idea, but remember
that only gifts costing up to £50 per person per year (how much!) that are
specifically related to your business and bearing the business name can be
claimed as a business expense. Food and drink are not allowed. But it
means you could offer diaries to keep records of food/exercise, pens or
keyrings with your name on – anything to keep the client keen and to keep
your name in the forefront of their mind!
Feature
Article – Using eBay
Each
month we provide a full page feature on a different topic of interest.
This month we are talking about using eBay as a way of generating
more business for personal trainers.
With
over 35 Million registered users and 5 Millions visitors per DAY,
eBay.co.uk is just about the greatest online marketplace in the world,
and you can tap into it to sell your health and fitness services. You
probably already know the obvious way to sell products on eBay but it is
also an incredible marketplace for any and every product or service you
can imagine.
It
typically costs less than 20p to put an entry onto EBay, and exposes you
and your services to a lot of people!
You
really have nothing to lose here (except 20p!) so try an entry in either
the Fitness section, Diet section or maybe the Everything Else – Services
section – have a look through and see what suits you.
You
could use some sort of heading like –
Personal
Trainer
Salisbury, Wiltshire - Lose Weight / Shape Up
Fitness
Assessment plus 1 hour Personal Training session
Add a
picture of yourself (if you think this is selling point) and then use the
description area to write a bit about yourself and your services, and
exactly what they get for their money.
The
point really of this exercise, is to generate new clients rather than make
money in its own right, but in terms of pricing you could choose to set a
minimum starting price e.g. £10, in which case you wouldn’t do it for
anything under £10. Alternatively, you might leave the starting price at
£10 and add a Buy It Now Price of say £20 – i.e. by bidding £20 they stop
the auction and get the item.
So an
example entry might look something like this –
Personal
Trainer Salisbury, Wiltshire - Lose Weight / Shape Up
Fitness
Assessment plus 1 hour Personal Training session
Starting
Bid £10.00
Buy it
Now Price £20.00
Making
time to look after yourself – eating properly and exercising well – can be
difficult in today’s fast paced world.
This is
where a Personal Trainer can make a real difference to your life – long
term.
My name
is Sally Smith and I am a qualified Personal Trainer and Sports Massage
Therapist with advanced qualifications from the British Association of
Cardiac Rehabilitation. I am fully ensured and registered, and you can
find out more about me on my website at www.fitfile.co.uk.
You are
bidding on a complete fitness assessment covering height, weight, BMI,
Body fat, Heart Rate and some basic fitness tests and a general overview
of your lifestyle and habits. This is then followed by a 1 hour personal
training session during which we will develop a personalised exercise and
nutrition program for you to follow.
This is
available to anyone within a 25 mile radius of Salisbury, Wiltshire.
Q & A
Q. I’m a self-employed PT. If
I claim 40pence per mile expenses on my car for tax can I also claim
servicing bills for repairs?
A. No.
You have two choices for claiming motoring expenses – you either claim
business mileage at the official rate (that’s 40p per mile for the first
10,000 miles then 25p per mile for any additional) or you claim a
percentage of your total motoring cost that reflects how many business
miles you do compared to personal miles. If you choose the 40p per mile
option, it is assumed that all motoring costs are covered in this figure.
Example
– if you drive 1250 business miles a year, and 2500 personal miles your
expenses would be:
Method a
– 1250 @ 40p per mile = £500
Method b
– if it costs in total say £4000 to run your car per year (400 insurance,
180 tax, 600 servicing and repairs, 1820 petrol, £1000 HP) then you can
claim 1/3rd of £4000 (because 1250 is a third of the total
mileage (1250+2500)) ie £1333.
Example
2 – if you drive a lot more - 12500 business miles a year - and only 2500
personal miles, your expenses would be:
Method a
– 10000 @ 40p per mile = £4000 + 2500 @ 25p = £625 =
£4625
Method b
– if it costs in total say £5500 to run your car per year (400 insurance,
180 tax, 600 servicing and repairs, 3320 petrol, £1000 HP) then you can
claim 83% of £5500 (because 12500 is 83% of the total mileage
(12500+2500)) ie £4565
So your
method will depend on how many miles you do, but also method a is much
easier to administer and work out, so will save a lot of time and effort
over method b.
Q. I am
a newly qualified PT and want to set up a small gym & personal training
business as a sole trader and will need some start-up funds. Who would be
the best business loan company or should I go to my bank, would I have to
put something down my self and would my home be at risk if things went
wrong?
Starting
any new business is inherently risky and you might want to consider
starting on the PT side first which will involve lower start up costs. If
you’re sure you want to open a gym from the start friends and family are
often a good way to finance the early stage of a business but arrangements
should be put on a business footing with a written agreement about the
duration of the loan, the interest payable and repayment terms.
As a
sole trader you have unlimited liability which means that if the
business incurs losses or ultimately fails, your creditors will have a
claim on your assets including your home. Any finance provider would
expect you to demonstrate your commitment and confidence by contributing
to the funding.
There
any many finance providers and deciding which would be best for your new
business depends on the assets you wish to acquire. If you are looking for
working capital then a bank might be a good start. Whatever source you
seek finance from consider the terms of any offer of finance – the
interest rate, repayment terms, period of the finance and other conditions
such as whether you can pay the loan off early. It might be worth looking
at the Finance and Grants section of the
businesslink.gov website.
Q. I
want to run fitness classes for children at my local church hall. Do I
need any special license or anything to work with children?
If you
are going to work in a way that brings you into contact with children you
should be able to provide a CRB (Criminal Records Bureau) check. However,
the
current
legislation does not allow the self-employed or individuals to apply for a
CRB check on themselves so you will need to speak to someone like the
church office to provide you with an application form. The CRB has
developed a guide called
Applicant’s Guide to the CRB 's Disclosure
Service (DIP 017) available at www.crb.gov.uk |
