A gym's revenue arrives in hundreds of small direct debits, its biggest cost is a lease signed for years, its trainers might be employees, contractors or rent-paying tenants, and its profit depends on how many members stay rather than how many join. We work with independent and franchised gyms, studios, personal trainers and allied wellness businesses across Brisbane and Logan, and this page covers what matters.
Accountants who treat a gym like a shop miss most of what decides whether it makes money.
02Membership billing runs through a direct debit platform that charges weekly or fortnightly, takes its fee, and settles the balance to the gym's bank account in batches.
03The personal trainer question is the compliance risk that sits in most gyms.
04The lease is the biggest number a gym owner will sign.
Accountants who treat a gym like a shop miss most of what decides whether it makes money. The revenue is recurring but fragile, the cost base is fixed and front-loaded, and the compliance risk sits in how the trainers are engaged rather than in the till.
The owner who does well in this industry usually started as a trainer or an instructor and learned the business side on the job. The accounting side of that job has specific traps: revenue recognised in the wrong month, trainers engaged in a way the ATO will not accept, a lease that outlasts the member base, and a structure that was right for one trainer and is wrong for a club with twelve staff. We deal with each of those below.
We work with independent gyms, franchised clubs, pilates and yoga studios, boxing and functional training gyms, personal trainers at every stage, and allied wellness businesses such as massage, recovery and nutrition practices. The Victoria Point office is close to the gyms and studios across the Redlands and the bayside, and the Jimboomba office covers the fast-growing fitness businesses across Logan and the Scenic Rim. Most of the work happens in Xero, so where you train from rarely matters.
Membership billing runs through a direct debit platform that charges weekly or fortnightly, takes its fee, and settles the balance to the gym's bank account in batches. The bank statement shows the net settlement, not the gross revenue, the merchant fees or the failed payments. If the bookkeeping starts from the bank feed, revenue is understated, fees are hidden and the member ledger never agrees to the accounts.
We set up the billing platform to integrate with Xero so gross membership revenue, platform fees, failed payments and refunds are recorded separately. Paid-in-advance memberships, foundation offers and twelve-month upfront deals are recognised over the period they cover, not in the month the cash arrives, which matters for management reporting and for the accuracy of the profit figure when the business is eventually sold.
Failed and dishonoured payments deserve their own report. A rising dishonour rate is an early sign of churn and of a member base that is stretched, and it is cheaper to fix in the first fortnight than after the member has cancelled.
The personal trainer question is the compliance risk that sits in most gyms. A trainer who rents floor space, finds their own clients, sets their own prices and invoices members directly is likely a genuine contractor, and the gym's income from them is rent. A trainer who is rostered by the gym, paid by the hour or by the class, trains the gym's clients at the gym's prices and uses the gym's booking system looks like an employee, whatever their invoice says.
The consequences of getting it wrong run backwards for years: super guarantee on all the payments, PAYG withholding, leave entitlements under the Fitness Industry Award, workers compensation premiums and payroll tax. The ATO and Fair Work look at the facts of the relationship, and super can be payable to a contractor who is paid mainly for their labour even where the contractor status is genuine.
We review each arrangement, set up written agreements that match the actual working relationship, and get the payroll or the rent invoicing running correctly in Xero.
The lease is the biggest number a gym owner will sign. Fitness tenancies tend to be large, long, and in centres or industrial estates where the landlord knows a fit-out is expensive to move. Before signing, the rent should be tested against a realistic membership ramp-up, the incentive and fit-out contribution negotiated, the outgoings understood and the make-good clause read twice. We model the lease against the forecast so the owner negotiates from numbers rather than hope.
Equipment is the second number. Treadmills, rigs, reformers and cable machines are usually financed over three to five years through a chattel mortgage, lease or rental agreement, and each has a different GST, interest and depreciation treatment. The instant asset write-off can apply to purchases under the current threshold for eligible businesses, and we check the rules before the order rather than after. Equipment that is rented rather than owned is a cash flow decision as well as a tax one, and it affects what a buyer will pay later.
Fit-out itself is often the largest capital spend in a new gym, and how it is treated depends on what each item is. Flooring, rigs bolted to the slab, mirrors, changing rooms and air conditioning are depreciated at different rates, some as plant and some as capital works. We split the builder's invoice properly at the start so the deductions are claimed at the right rate from the first year.
Most gym owners know their member count and their monthly revenue. The numbers that actually decide the business are a layer below that, and an accountant who understands the industry will put them in front of you every month.
Churn is the percentage of members who leave each month. Lifetime value is the average revenue a member brings before they leave, less the cost of acquiring and servicing them. Average revenue per member shows whether discounting is eroding the base. The breakeven member count tells you how many active members cover the lease, wages and loan repayments. Class and session margin shows whether a class with six people in it is making money after the instructor is paid.
We build these into a monthly report alongside the profit and loss. Pricing decisions, such as whether to introduce a premium tier, change the joining fee or run a foundation offer for a new site, are then tested against lifetime value and churn rather than instinct. A small reduction in churn is usually worth more than a large marketing spend.
Many trainers start as sole traders, invoicing a few clients and renting floor space. That is the right structure at the beginning. It stops being right when income climbs into the higher tax brackets, when the trainer takes on staff or a lease, or when there is anything at risk if a client is injured. At that point a company, sometimes with a family trust holding the shares, offers a lower tax rate on retained profits, better asset protection and a cleaner path to selling or bringing in a partner.
The move has to be done properly. Transferring clients, equipment and the lease to a new entity, setting a market salary for the owner, dealing with the personal services income rules that can apply to a trainer whose income is mostly their own effort, and handling Division 7A if the company lends money back to the owner, are all things we manage in the transition.
GST registration becomes compulsory once turnover reaches the registration threshold, measured on a rolling twelve-month basis. Registering early can be sensible when there is a fit-out or equipment to claim credits on. Registering late attracts penalties and a GST bill on sales where no GST was collected. We watch the turnover as it approaches the threshold and get the timing right.
Franchised gyms pay an initial franchise fee, ongoing royalties, marketing fund contributions and often equipment and fit-out to the franchisor's specification. The initial fee is a capital cost that is generally not deductible outright, the ongoing fees are deductible as incurred, and the GST on each is claimable once the business is registered. The franchise agreement also shapes the structure, the lease, the sale process and what the business is worth at the end of the term. Our franchise accountant page covers the detail.
Opening a second site is the point where a fitness business becomes a group. The question is whether the first site's profit and the owner's time can carry the second through its ramp-up, and whether the structure, usually a separate entity per site with a holding company above, is in place before the lease is signed. We model the second site's cash flow, funding, staffing and the effect on the owner's income across the first eighteen months, so the decision is made with the numbers rather than on the strength of a good opening month.
“Lauren has been absolutely fantastic in guiding us through the set-up of our Pty Ltd business.”
It depends on the facts, not the invoice. A trainer who rents your floor, finds their own clients and sets their own prices is usually a contractor. A trainer you roster, pay by the hour or class and who trains your clients at your prices is likely an employee, with super, PAYG withholding and award entitlements attached. Super can also apply to genuine contractors paid mainly for labour. We assess each arrangement and document it properly.
You must register once your turnover reaches the GST registration threshold, measured on a rolling twelve months, and you can register voluntarily before that. Early registration lets you claim GST credits on equipment and fit-out, but you then add GST to your prices. Registering late means penalties and paying GST you never collected. We monitor your turnover and time the registration so neither happens.
Ongoing royalties, marketing fund contributions and training fees are generally deductible when incurred. The initial franchise fee is usually a capital cost that is not deductible outright, although it forms part of the cost base and may be partly deductible over the term in some cases. GST on franchise fees can be claimed once your business is registered. We review the agreement so each payment is treated correctly.
When your income is pushing into the higher personal tax brackets, when you take on staff or sign a lease, or when there is real liability risk. A company gives a lower rate on retained profits, protects personal assets and makes a future sale cleaner. The personal services income rules may still apply if the income is mainly your own effort, so the structure needs to be set up and run correctly.
An upfront or foundation membership is revenue earned over the period it covers, not in the month the cash lands. Spreading it across the term gives an accurate monthly profit, stops a strong sales month hiding a weak operating month, and matters when a buyer or bank reviews the accounts. We integrate the direct debit platform with Xero so gross revenue, fees and deferred income are recorded correctly.
Beyond revenue and profit, the numbers that predict where the business is going are monthly churn, net member growth, lifetime value per member, average revenue per member, the dishonoured payment rate, the breakeven member count and margin per class or trainer. We report these alongside the profit and loss each month, so pricing, staffing and marketing decisions are made on evidence rather than on a good or bad week.
