Today we would like to describe a practical problem that one of our clients has encountered. It offers gym access and personal training services. What VAT rate should be applied here?
According to Art. Article 41 sec. 2 in connection with Article 146ea sec. 2 of the Polish VAT Act for goods and services listed in Annex 3 to the Act, other than those classified according to the Polish Classification of Goods and Services (Pol. PKWiU) in the grouping of food-related services (PKWiU 56), the tax rate is 8%, subject to Article 114 sec. 1 and Article 138i sec. 4 of the Polish VAT Act.
On the other hand, item 65 of Annex 3 to the Polish VAT Act indicates services related to entertainment and recreation – only in the scope of admission to amusement parks, amusement parks, discos and dance halls.
On the other hand, item 68 of Annex 3 to the Polish VAT Act lists other services related to recreation – only in the scope of admission.
Referring to the common interpretation of the provisions of item 68 of Annex 3 to the Polish VAT Act, there are also services of admission to gyms and other sports facilities. As an example, the description of the service for which the Director of the National Tax Information in the Binding Rate Information of 4 November 2020 (file reference number 0112-KDSL2-2.450.923.2020.1.AG) found that it is subject to the 8% VAT rate:
“The Applicant offers passes to the fitness room – gym, with equipment for exercise and recreation, promotion of a healthy lifestyle. The customer exercises on the equipment alone. There is no instructor or personal trainer. The room is located on the 1st floor of a commercial and service building. The premises are rented on the basis of a lease agreement. The service is provided mostly to natural persons, less often to business entities. The equipment in the hall is used by random people who have bought a ticket or an entry pass. The customer does not receive any attestations or certificates, he has the option to choose devices. The condition for entering the hall is to pay a fee (purchase of a pass), entitling to a certain number of entries to the hall for a given period, e.g. 1 month, 3, 5, 8 months, etc. Passes are personal. The possibility of taking advantage of the employee’s advice is included in the price of the pass.”
As it follows from the above, the admission to the gym itself is taxed at the 8% VAT rate.
A similar position is indicated in a number of other decisions, for example in the Binding Rate Information of the Director of the National Tax Information of 5 August 2024 (file reference number 0110-KSI2-2.441.29.2024.2.DK).
However, from the perspective of the present facts, it is crucial to determine whether the same rate can be applied to the service of entry to the club and the possibility of the customer taking advantage of personal training.
In the first place, it should be clarified that the admission referred to in item 68 of Annex 3 to the Polish VAT Act should be understood broadly, i.e. that the admission is not limited only to the entrance to the premises of a given facility, but is related to the service provided there. Which means that it is not the fact of admission that determines the VAT rate, but the service provided as part of the admission.
Therefore, in our opinion, the membership will entitle you to enter the gym and the possibility of using personal training understood as the care of a personal trainer assigned to a given person and the performance of training by this person in accordance with the trainer’s recommendations, then such a membership should be taxed at the rate of 23% VAT.
This interpretation of the provisions is confirmed by the Director of the National Tax Information in the Binding Rate Information of 10 November 2021 (file reference number 0112-KDSL2-2.440.227.2021.4.KP), in which it held that the personal training service provided as part of the entrance to the gym is taxed at a 23% VAT rate.
The authorities distinguish between situations where the pass entitles to admission to group classes of a recreational nature, which are not individual personalized training or professional group training that is not of a recreational nature (file reference number 0112-KDSL2-1.440.97.2024.3.MW). And so, following this line of reasoning, the Director of the National Tax Information in the Binding Rate Information of 25 January 2023 (file reference number 0112-KDSL1-1.440.207.2022.3.DS) made it possible, for example, to apply the VAT rate of 8% for admission services to acrobatic classes for children. Similarly, information is issued indicating that group classes are subject to taxation at the rate of 8% – for example, the Binding Rate Information of 4 October 2021 (file reference number 0112-KDSL2-1.440.199.2021.2.BK).
