Is fitness expert’s income exempt from VAT?
One of my sole trader clients is approaching the compulsory VAT registration threshold, but I am not sure if his income would be classed as exempt, taxable or a combination of both.
Basically, he is a fitness expert and also a top golfer, and his business model is as follows:
- He devises fitness programmes to develop strength and stamina for top golfers who are seeking to improve their ranking on the professional circuit. Many of his clients will have one-to-one personal training sessions with him in a local gym.
- He also prepares fitness programmes for golfers who have suffered an injury and need exercise routines to help with their recovery process. My client is a member of the Chartered Society of Physiotherapy.
My question is simple: do any of his fees qualify as exempt from VAT through either the private tuition or medical services legislation in VATA 1994, Sch 9, and can they therefore be ignored in the registration calculations?
Query 20,743– Tiger Woody.
Dollar loan revisited
I submitted query 20,726 (Taxation, 18 June 2026) about the tax treatment of two dollar loans made by a UK-resident individual to a foreign resident. One of the respondents considered that the exchange gain or loss on the principal would be within the scope of capital gains tax (CGT). The other wrote that, in the absence of any indication that the loan was a ‘debt on a security’, the principal would be exempt and the only tax charge that would arise would be income tax on the interest.
I can see both sides of the argument, but is a loan to be treated as ‘a foreign currency asset’ (chargeable to CGT) or ‘a simple debt’ (exempt)? I would be grateful for chapter and verse and a definitive answer!
Query 20,744– Buckstop.
Writing off a loan
Our client, company A, extended a loan to an unconnected company (company B) that went into liquidation in October 2025. We are preparing the accounts and tax computations for company A for the year ended 31 December 2025. The loan will be written off in full as the liquidator has informed us that there are no funds to meet any liabilities to creditors.
As company B is in liquidation, can company A claim tax relief on the write-off of the loan between these unconnected parties under the loan relationship rules? I know that there are special rules that prevent tax charges for companies in insolvency where they are unable to repay loans. As far as I know, these do not affect the position of the company that made the loan, but as the amounts are material and I have not seen this situation before, I would appreciate confirmation from readers that I am able to advise the company that it will be entitled to a deduction for the loss on the loan.
Readers’ thoughts would be appreciated.
Query 20,745– Debbie Ted.
Rent a room relief for annexe
We have a client who rents out a self-contained annexe attached to his house via Airbnb, which is a jointly owned property with his spouse. The annexe comprises a living area with a kitchen, a bedroom, and a bathroom. It is separated from the main house by a corridor, and no rooms within the main house are shared with the guests. The driveway is shared with the guests.
The annexe does not have a separate postcode, and the council tax and utility bills are shared with the main house.
Under these circumstances, could our client claim rent a room relief?
Query 20,746– Landlady
Queries and replies
Send queries and replies to taxation@lexisnexis.co.uk. Replies should be submitted by Monday, 11 days after print publication. We pay £40 for each reply published in the magazine and select those which reflect the widest range of answers. As a result, the views expressed are not necessarily our own and so they should be read with a critical spirit. Contributions may be identified by name or a pseudonym. For full T&Cs visit: tinyurl.com/RFguidelines.
