Are you aspiring to become AN IndEPENDENT PERSONAL TRAINER and not sure where to begin?
We have gathered our best business tips, tricks, and resources to assist you in not only becoming your own boss but in creating your most successful business. We are here to help you throughout the process and remember, 'Enjoy the Ride'.
CERTIFICATIONS & LICENSES
First off, personal trainers need to obtain a reputable, nationally organized Personal Training Certification. Once you decide to start your independent business in California, you need a business license to operate legally.
Use our previous DB04 Blog, "OUR GUIDE TO BECOMING A TRAINER AND CONTINUING YOUR EDUCATION" as your resource for comparing certifications and expanding your knowledge.
A business license, occupational business license, a home occupation permit, etc., are all the same in that they are a form of tax registration. ALL small businesses, even home or online businesses must register for occupational business tax.
Fill in your business info, go to check out, and your license will be filed and on its way in the mail. Keep in mind that some states require you to first get a fictitious business name registration, such as Florida. Check out the links below for state requirements, California specific requirements, California city specific requirements, and application links to officially get your business license. Please make sure to double check with the county/city authority once you are done to make sure you have all your bases covered!
Thinking about trademarking your company name? Learn how to below!
Most common Business Structures include:
- Sole Proprietor
- General or Limited Partnership
- Limited Liability Company (LLC)
- Limited Liability Partnership (LLP)
- S Corporation
It's important to know that each business form comes with different tax consequences so you will want to carefully and wisely choose the structure that best fits your business's needs.
As an Independent Personal Trainer in California, you are a Sole Proprietor. This license is the simplest, least expensive, and most common structure chosen to start a business as no formal action is required to form a sole proprietorship. It is an unincorporated business owned and run by one individual with no distinction between the business and the owner. You are entitled to all profits and are responsible for all your business's debts, losses, and liabilities. If you are the only owner, this status automatically comes from your business activities.
It's Tax Time! If you are a Sole Proprietor, you may be able to use your Social Security Number. If not, you must apply for an Employer Identification Number (EIN), also known as a Federal Tax ID Number, from the Internal Revenue Service (IRS). This is your own personal tax number! If you plan on expanding your business and hiring employees, a business tax number is obligatory to identify your business and allow you to hire staff.
Filing Taxes! The key to paying less income tax is finding and taking more deductions. If you don’t know what you can deduct, it is easy to miss out on hundreds or even thousands of dollars’ worth of deductions.
The IRS says that you can deduct all ordinary and necessary expenses. How do I determine if any expenditure is a deductible business expense? Just ask yourself the simple question, “Would I have spent this money if I weren’t a personal trainer or fitness entrepreneur?" If you answer “yes,” then the expense is most likely a personal item and probably not deductible. Now, if you can honestly answer “no” to that question, then it probably is an expense that you can and should deduct in calculating your taxable income.
Another key to not paying more than necessary in taxes is creating a written or electronic record: Record Keeping! Make it a habit to never pay for any business expense with cash. Instead, use a dedicated credit or debit card so that all of your transactions are recorded. In order to avoid any questions about what is business and what is personal, set up separate business bank accounts and even get a separate credit card that you use only for business expenses. EXAMPLE: Do you travel to your clients’ homes? If so, your automobile expense could be one of your biggest deductions.
The most common areas that personal trainers deduct expenses for:
- Home Office
- Certification/Education Costs
- Other Purchases (equipment, health insurance)
If you want to deduct business expenses from your income you need to keep a record of your spending.
- Print all online receipts to place in a physical folder. OR
- Scan paper receipts to save in your computer.
Just make sure you have a record to prove to the IRS in case you’re audited (this is when they check up on your math). Then, create a spreadsheet to keep track of the total expenses for each category.
Keeping track of your expenses as you incur them will make year-end bookkeeping much easier!
Quickbooks and ZohoBooks are popular Point of Sale systems (POS) . Check out the link below to compare more.
In this day and age, accepting mobile payments from your clients is expected and can make life much easier for both of you.
- Transfer money directly from their bank account or credit card to you, using software such as Paypal.
- Face-to-face transactions with cloud-based service like Square or Intuit Go Payment will allow your clients to swipe their cards.
While many online payment processors track all of your invoices, making bookkeeping a snap, they come with risk.
- Be sure your online payment method is familiar to you and your clients, operated with top-notch security, and offers buyer and seller protection.
- Think about setting up recurring payments (i.e. memberships), so that you never have to track down clients for money.
Click the link below for Pros & Cons of the current Top Payment Systems.
With this all said and done, assess your financial position.
An income statement, along with the balance sheet and cash flow statement, is one of the primary financial statements used to assess a company’s financial position. A P and L (profit and loss) or “statement of operations” is an income statement that measures a company’s financial performance over a specific period of time. It is typically generated monthly, quarterly or annually, and lists all relevant revenues, expenses, gains and losses in order to calculate the company’s net income for the period.
This allows you to be organized, prepare to show where deductibles are coming from, recap income, and discover where improvements can be made to increase profits by cutting costs.
It is wise to purchase liability insurance to protect yourself in case of a lawsuit. General Liability is better than nothing, but since your job entails giving fitness and nutrition advice you need to cover yourself with more coverage.
Professional Liability (AKA Malpractice Insurance) includes almost everything you need to cover you as you grow your training business. The best, most credible place to get personal trainer insurance is through your national certification. Check for discounts through the ACE, NASM, ACSM, and NSCA websites. Also, be sure the company you pick is rated “A” through A.M. Best Company.
TRAINER SOFTWARE & APPS
Keep up with programming, progress, nutrition, and more using one of the multitude of apps designed for Personal Trainers. To name a few reputable Apps:
- Training Slate
Not to mention...Google Sheets! It's FREE and you can send the link to clients and update their progress. Check out the example below.
Need some additional help?
Check out DIAKADI’s Intern Program for additional assistance with developing the fitness and business side of your own practice.