Gibraltar tax relief for gym and personal trainer fees

In Gibraltar’s 2023 annual budget it was announced that from 1 July 2023 “Individuals who are enrolled in a gym or who contract a personal trainer who is registered with the tax office, will be able to deduct 10% of the verified cost against the bottom line of their tax bill”.

Application form

Whilst the draft legislation regarding this measure is still pending, the Income Tax Office have helpfully issued the application form for applying for this tax relief for the 2023/2024 Gibraltar tax year (i.e. year from 1 July 2023), which can be accessed here Gym or PT application.pdf (gibraltar.gov.gi). Please contact your gym reception to obtain the gym taxpayer reference.

To apply for this tax relief, the application form should be submitted alongside the individual’s Gibraltar tax return for the tax year. So for the 2023/2024 tax year, for most taxpayers it should be submitted with their IT1 Gibraltar tax return, which can be accessed here Tax Return Form2024.pdf (gibraltar.gov.gi) by the 2023/2024 filing deadline of 30 November 2024.  Proof of gym or personal trainer (‘PT’) payment is also required to be provided.

Up to 10% tax credit

Lynette Chaudhary, Director of Sovereign Tax Services, explains:

“Where an individual paying gym or PT fees is a Gibraltar taxpayer, they can claim 10% of the fees paid as a tax credit against their annual Gibraltar tax liability. Therefore, as an example, if an individual has paid £500 of gym/PT fees in the year, they can save £50 of Gibraltar tax for that year.”

Pending publication of the legislation, based on Income Tax Office guidance, this tax credit:

-  Is available to all Gibraltar taxpaying gym-goers, regardless of whether they are taxed under the Allowance Based System or Gross Income Based System. 

-  Is set off against an individual taxpayer’s Gibraltar tax liability for the year, on their annual tax assessment, prior to any tax paid for the year i.e. prior to any Gibraltar PAYE or payments on account paid. 

- If this leads to an overpayment of tax, when taking into account the tax paid for the year, then this tax will be refunded to the taxpayer.  This minor loss of revenue for the Government will hopefully be compensated by much larger savings to the Gibraltar Health Authority, by having a fitter and healthier nation. 

Lynette comments “Prior to 30 August 2024, the Income Tax Office, based on the budget announcement, and in the absence of legislation regarding this measure, were applying this credit to the year-end tax payable figure, after any PAYE and/or payments on account paid for the year had been deducted.  This significantly restricted the number of taxpaying gym-goers that could utilise this relief.  Essentially, for any taxpayer whose only Gibraltar assessable income was employment income with PAYE correctly deducted, or self-employment income with payments on account settling their tax liability for the year, the tax credit could not be utilised and was in effect lost.  However, after representations made, including by Sovereign Tax Services, we are pleased that the Income Tax Office changed how they will apply this credit (and the similar private education tax credit), which is now available to be utilised by all Gibraltar taxpaying gym-goers, as outlined above. The Income Tax Office application forms have been updated accordingly”.

Corporate memberships

Where individuals are gym members via corporate membership, any amount paid by the employee for gym/PT fees can qualify for this tax relief, with all payslips for the period required to be provided to evidence the amount paid by the employee in gym/PT fees (where employee payment is deducted via the payroll). 

Any gym/PT fees paid for/borne by the corporate employer will not qualify for this tax relief, only the amount paid by or reimbursed by the individual employee qualifies.    

Sovereign Tax Services provide Gibraltar personal tax advisory and tax compliance services, along with UK personal tax services for non-UK residents. 

For further information, email tax.gib@sovereigngroup.com or call +350 200 76173. 
Sovereign Tax Services is a trading name of Sovereign Fiscalis Limited, Sovereign Place, 117 Main Street, Gibraltar, Company Registration Number 84307.

*Please contact your gym reception to obtain the gym taxpayer reference