If the UK government lowers the VAT registration threshold to £30,000, many personal trainers could find themselves needing to charge VAT and submit returns. But don’t panic — there are steps you can take now to stay ahead.
1. Know Your Numbers
Track your turnover carefully. If you’re approaching £25k–£30k annual revenue, start thinking ahead. Knowing when you might cross the threshold helps you plan pricing and cash flow.
2. Review Your Pricing Structure
If VAT registration becomes mandatory, you’ll need to charge an extra 20% on services. Decide whether to:
- Pass it on to clients (higher invoices), or
- Absorb it (lower profit margin but same client cost).
Clear communication is key — nobody likes a surprise price hike.
3. Update Bookkeeping Systems
VAT comes with extra record-keeping. Using accounting software that handles VAT from the start makes life much easier. Track sales, expenses, and receipts meticulously.
4. Consider Voluntary VAT Registration
Even before hitting the threshold, registering voluntarily can have advantages:
- You can reclaim VAT on equipment, training courses, and studio hire.
- It familiarises you with VAT returns before you’re forced to do them.
5. Check Your Contracts and Invoices
Ensure your client contracts and invoices can accommodate VAT if needed. Small wording tweaks now can save headaches later.
6. Communicate With Clients
Transparency builds trust. If your prices will rise due to VAT, let clients know early. Framing it as a business compliance issue rather than a random price hike can soften the impact.
7. Seek Professional Advice
A qualified accountant can run scenarios based on your earnings and advise on whether voluntary registration or price adjustments make the most sense.
Planning ahead gives you control. A potential VAT threshold drop doesn’t have to be a “panic moment” — it can be an opportunity to streamline your business, improve your accounting, and keep your clients informed.
