Corporate Gym Membership

My employer has offered to pay for a corporate gym membership for me for 2010, but will I be taxed on the cost of the membership?

1st January 2010

If your employer provides you with access to sporting or recreational facilities (or vouchers that are exchangeable for their use), providing certain conditions are met the cost met by your employer is tax free.

The conditions are that the facilities are available for use by all of the firm's employees and the facilities aren’t available to the general public. In addition the facilities must be used mainly by employees or former employees, or by members of employees’ families and households.

The facilities don’t have to be used exclusively by your firm's employees – so if your employer has jointly offers the facility with another firm and their employees use the facilities too, the membership is still tax free.

The cost of the membership is not tax free where the facilities are open to the public, or based at a private residence or holiday accomodation, or where the membership provides you with use of a vehicle (which includes boats and aircraft).

In most cases employers secure preferential rates at public gym facilities, rather than offering to meet the full cost of the membership, as the provision of the membership will be a taxable benefit. If they pay your membership, you are then liable to pay tax on the full cost of providing you (and members of your family or household where appropriate) with the use of the facilities in question.

By Jo Nockels

Disclaimer: The information provided is based on current guidance (at date of publication) from HMRC and may be subject to change. Any advice shared here is intended to inform rather than advise. Taxpayer's circumstances do vary and if you feel that the information provided is beneficial it is important that you contact us before implementation. If you take, or do not take action as a result of reading this information, before receiving our written endorsement, we will accept no responsibility for any financial loss incurred.

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