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The Australian Taxation Office (ATO) provides specific guidelines about what can be classified as a business deduction. Generally, for a fitness membership to be deductible as a business expense, it must be directly related to the nature of the business and necessary for earning assessable income.
For example, if you run a business that requires a high level of physical fitness, such as personal training, dance instruction, or a job requiring physical security services, the cost of a gym membership may be considered a legitimate business expense. However, if the fitness membership is for general health and well-being and not strictly necessary for your work duties, it is unlikely to be deductible.
References:
According to the Australian Taxation Office (ATO), you generally cannot claim gym fees or fitness-related expenses as a tax deduction. These are considered private expenses unless they meet very specific criteria related to employment requirements (ATO.gov.au).
For gym membership fees to be deductible, there needs to be a direct connection between maintaining your fitness and your job duties. This usually applies if your role requires you to perform strenuous physical activities as an essential and regular part of your duties, and you need to pass fitness tests and medical exams to maintain your employment. Examples include professions where physical fitness is critical, such as certain roles in emergency services, athletes, or physical trainers (ATO.gov.au).
Most occupations, however, do not meet these criteria, and fitness expenses, including gym memberships, would not be deductible. This includes cases where fitness might be beneficial to general productivity or wellbeing but is not a strict requirement of the job (ATO.gov.au).
For more specific information or to check updates, you can visit the ATO’s page on gym fees and fitness-related expenses here: Gym fees and fitness-related expenses.
Key Notes:
Fitness Expenses: This amount reflects the cost of the gym membership or fitness expenses incurred by the sole trader. Since these expenses are considered private and not directly related to the business’s operations, they do not reduce the taxable income and are instead shown under owner’s drawings in the Equity section of the Balance Sheet. This distinguishes them from operational expenses that impact the profit or loss of the business.