Expensing a Gym with Workspace

[petersnip]

I am under the impression that you can't expense a gym membership with a coworking space. However, it is about one 5th of the price of a co-working space, so I feel like it should be justifiable to file this as a tax deductible expense? If a co-working space is tax decidable, surely being able to get the same benefits for significantly less makes much more business sense? We have two full time directors, and no other employees. How likely is HMRC to accept my reasoning?

The only benefit that the coworking space provides is a printer (we don't print anything) and beer on tap. Although I am sure HMRC doesn't care, the gym seems like a much more reasonable addition than beer.

 

[PCD]

The cost should be deductible for for Corporation Tax if the company contracts with the provider. However the cost of the gym membership would be a taxable benefit in kind to be reported on P11D. If the company pays but the contract is with the directors rather than the company the cost should be put through the payroll. Not heard of a co-working space offering beer on tap.

 

[MyAccountantOnline]

I am under the impression that you can't expense a gym membership with a coworking space. However, it is about one 5th of the price of a co-working space, so I feel like it should be justifiable to file this as a tax deductible expense? If a co-working space is tax decidable, surely being able to get the same benefits for significantly less makes much more business sense? We have two full time directors, and no other employees. How likely is HMRC to accept my reasoning?

The only benefit that the coworking space provides is a printer (we don't print anything) and beer on tap. Although I am sure HMRC doesn't care, the gym seems like a much more reasonable addition than beer.

Have a read of this it should help

Fitness at Work

Guidance on using the tax system to offer gym memberships and sports facilities to staff.

www.gov.uk

 

[petersnip]

The cost should be deductible for for Corporation Tax if the company contracts with the provider. However the cost of the gym membership would be a taxable benefit in kind to be reported on P11D. If the company pays but the contract is with the directors rather than the company the cost should be put through the payroll. Not heard of a co-working space offering beer on tap.

I think WeWork used to offer this, although not 100% sure if they still do. I was mostly making the point for effect as you could fully expense the WeWork. Just frustrating that it's virtually the same thing, but exceptions are made for one (co-working space being a full expense) and not the other, especially given the price difference.

 

[petersnip]

Have a read of this it should help

Thanks for sending that through! But you don't think HMRC would accept the business case for fully expensing a significantly cheaper gym (relative to something like a WeWork) with a workspace as a co-working space?

 

[Frank the Insurance guy]

Instead of a gym membership with free co-working space, can they not charge your company for co-working space with the added benefit of a free gym membership?

If you are paying for co-working space and not the gym, this may be fully tax deductible - perhaps one of our accountant members can confirm?

 

[Paul Kelly ICHYB]

Not heard of a co-working space offering beer on tap

You're looking at the wrong workspaces.

I always laugh when people say they get 'free beer on tap' and then they tell me what they pay for the space!

 

[Bobbo]

Thanks for sending that through! But you don't think HMRC would accept the business case for fully expensing a significantly cheaper gym (relative to something like a WeWork) with a workspace as a co-working space?

your issue is not whether the company can deduct the cost of the gym/workspace from its profits for tax purposes. it can do so. the issue is whether the provision of gym facilities to staff members constitutes a benefit in kind assessable on said employees and Class 1A NIC for the company to pay.