Were fitness memberships exempt as instruction fees when members could use the gym during normal business hours?

Plain-English summary

The Florida Department of Revenue ruled that a fitness operator's prepaid and recurring membership dues were taxable admissions, not exempt professional-instruction charges.

Although the operator offered one-hour classes, its agreements granted facility access during normal business hours. Members could therefore use the gym when classes were not taking place. The agreements also treated personal training as a separately purchased membership.

Florida's instruction exception requires charges to be exclusively for instruction and facility access to be limited to the instruction period. These agreements did not meet that test.

What this means for you

Fitness clubs and studios

Broad access language can turn class-oriented membership fees into taxable recreational dues. Contract terms should match actual access practices.

Accountants and operators

Separately sold personal training does not convert a general gym membership into an exempt instructional program.

Common questions

Q: Why were the memberships taxable?
A: Members could use the facility during normal business hours, including times when no class was underway.

Q: What does the instruction exception require?
A: Charges must be exclusively for professional instruction, with facility use limited to the instruction period.

Q: Did separate personal-training memberships help?
A: No. They reinforced that the general dues purchased broader facility access rather than only instruction.

Citations and references

• Fla. Stat. §§ 212.02(1), 212.04, and 213.22
• Fla. Admin. Code r. 12A-1.005(4)(d)2

Source

• Landing page: Florida Tax Law Library
• Advisement: TAA 17A-021

Original ruling text

November 3, 2017

Executive
Director
Leon Biegalski

TAX: Sales and Use Tax
TAA NUMBER: 17A-021
ISSUE: Admissions
STATUTE CITE(S): Section(s) 212.04, and 212.02(1), F.S.
RULE CITE(S): Rule 12A-1.005(4)(d)2., F.A.C.
QUESTION: Are dues and fees paid by members exempt from sales tax as dues and fees paid
for instructional classes?
ANSWER: No, members have access to the gym facilities during normal business hours in
addition to instructional class periods.

XXXXXX
XXXXXX
XXXXXX
XXXXXX
Subject: Technical Assistance Advisement (“TAA”)
TAA 17A-021
Sales and Use Tax-Admissions
Section(s) 212.02(1), and 212.04, Florida Statutes (“F.S.”)
Rule(s) 12A-1.005(4)(d)2., Florida Administrative Code (“F.A.C.”)
XXXXXX (“Taxpayer”)(“Owner”)(“Petitioner”)
Business Partner Number: XXXXX
FEIN: XXXXXXX
XXXXXXXXXXX

Child Support – Ann Coffin, Director  General Tax Administration – Maria Johnson, Director
Property Tax Oversight – Dr. Maurice Gogarty, Director  Information Services – Damu Kuttikrishnan, Director

www.floridarevenue.com
Florida Department of Revenue
Tallahassee, Florida 32399-0100

Page 2 of 4
Technical Assistance Advisement
Dear XXXXX:
This letter is a response to your petition received September 18, 2017, for the Department’s
issuance of a Technical Assistance Advisement (“TAA”) to Petitioner, regarding memberships.
Your petition has been carefully examined, and the Department finds it to be in compliance with
the requisite criteria set forth in Rule Chapter 12-11, F.A.C. This response to your request
constitutes a TAA and is issued to you under the authority of section 213.22, F.S.
Facts
Taxpayer operates as XXXXXXXX. Taxpayer sells memberships, drinks, and clothing. The
memberships sold provide clients access to the XXXXX classes. Taxpayer’s website provides
that the classes last one hour. The members are required to book the classes in advance. Your
previous request provided that the gym facility is only available to members during class time.
Taxpayer’s website provides a video of Taxpayer’s facility. The video reflects that Taxpayer has
several XXXXXXX in its gym facility that are used by members. Taxpayer’s website provides a
schedule of classes that last for one hour each. The class times are scheduled every three hours.
Based on the schedule of classes, the hours of access for certain days provided on the website
schedule was from 8:00 a.m. until 9:00 p.m.
The request included copies of the prepaid membership agreement and the recurring dues
membership agreement. Both agreements provide an agreement provision for access and use of
facilities. It provides the following:
DESCRIPTION OF SERVICES; HOURS OF ACCESS. This Agreement entitles
you to access the XXXXX facilities and services during normal business hours,
which will be posted at each XXXXXX location. A XXXX XXXXXX class is a
full-body workout that begins with warm-up stretching, followed by intervals of
XXXXXXX, calisthenics, aerobics, and culminates with cool-down stretching.
(Emphasis added)
Both agreements have a provision regarding personal training memberships. It provides the
following:
If you have a personal training membership, you may cancel a personal training
session by giving at least a 24-hour notice of cancellation. If a 24-hour notice of
cancellation is not given, you will be charged for the session. If you are late for a
personal training session, the time will be subtracted from that session; session
times will not be extended.
Applicable Law and Response

Page 3 of 4
Technical Assistance Advisement
Section 212.04(1), F.S., requires sales tax to be collected on the sales price or amounts received
from the sale of admissions. Section 212.02(1), F.S., defines the term “Admissions.” It
provides, in part, the following:
(1) The term “admissions” means and includes the net sum of money after
deduction of any federal taxes for admitting a person or vehicle or persons to any
place of amusement, sport, or recreation or for the privilege of entering or staying
in any place of amusement, sport, or recreation, including, but not limited to, …
any place where charge is made by way of cover charges … or other fees or
receipts of anything of value measured on an admission or entrance or length of
stay … in any place where there is any … sport, or recreation, and all dues and
fees paid to private clubs and membership clubs providing recreational or
physical fitness facilities, including, but not limited to … athletic, exercise, and
fitness facilities …. (Emphasis added)
As provided by s. 212.02(1), F.S., the term “admissions” includes all dues and fees collected by
private or membership clubs providing recreational facilities. Your request maintains that the
dues and fees payments are for instructional classes.

Rule 12A-1.005(4)(d)2., F.A.C., provides, the following:
(d) Fees paid to private clubs or membership clubs that do not entitle the payor to
the use of the club’s recreational or physical fitness facilities are not subject to
tax. Examples of such fees are:

2. Charges for professional instructions in any sport conducted at the club, so long
   as such charges are exclusively for the instructions and include the use of the
   facility only during the period of time the instructions are taking place. It is
   not the intention of this rule to allow a club to exempt what is in effect a dues or
   membership fee by labeling such charges as instruction fees. (Emphasis added)
   Rule 12A-1.005(4)(d), F.A.C., provides that certain charges are not considered taxable dues and
   fees. Rule 12A-1.005(4)(d)2., F.A.C., provides that charges for professional instructions in any
   sport conducted at a club are not dues and fees, so long as such charges are exclusively for the
   instructions and include the use of the facility only during the period that the instructions are
   taking place. The Rule provides that it is not the intention of the Rule to allow a club to exempt
   what are in effect dues or membership fees by labeling such charges as instruction fees. As with
   most instruction, once the member learns the sport for which instruction is provided, then it is
   presumed that the instruction will be completed. In other words, classes must be designed with a
   goal of completion by the member.
   As required by the Rule, access to a club’s facilities must only be allowed during the class times.
   The agreement language does not provide for such a limitation, because access is allowed during
   normal business hours. Based on this agreement language, members may use Taxpayer’s

Page 4 of 4
Technical Assistance Advisement
facilities at times when classes are not being conducted. In addition, based on the agreement
provisions, separate memberships for personal instruction are purchased separately. Therefore,
Rule 12A-1.005(4)(d)2., F.A.C., is not applicable regarding the dues and fees paid pursuant to
the prepaid membership agreement and the recurring dues membership agreement. As such, the
tax imposed by s. 212.04, F.S., applies to the dues and fees paid pursuant to the prepaid
membership agreement and the recurring dues membership agreement.
This response constitutes a Technical Assistance Advisement under section 213.22, F.S., which
is binding on the Department only under the facts and circumstances described in the request for
this advice, as specified in section 213.22, F.S. Our response is predicated on those facts and the
specific situation summarized above. You are advised that subsequent statutory or
administrative rule changes, or judicial interpretations of the statutes or rules, upon which this
advice is based, may subject similar future transactions to a different treatment than expressed
in this response.
You are further advised that this response, your request and related backup documents are public
records under Chapter 119, F.S., and are subject to disclosure to the public under the conditions
of section 213.22, F.S. Confidential information must be deleted before public disclosure. In an
effort to protect confidentiality, we request you provide the undersigned with an edited copy of
your request for Technical Assistance Advisement, the backup material and this response,
deleting names, addresses and any other details which might lead to identification of the
taxpayer. Your response should be received by the Department within 10 days of the date of this
letter.
Respectfully,
Chuck Wallace
Chuck Wallace
Technical Assistance & Dispute Resolution
(850) 717-7541
AMS ID: 7000022886