Beauty, Fitness & Wellness
Bookkeeping for salons, gyms, and studios dealing with booth renters, memberships, tips, and the question of who counts as an employee.
The Industry
A salon has three stylists on payroll who receive tips through the card reader. Two booth renters who pay monthly rent and handle their own taxes. Retail products on the shelf that need inventory tracking. Prepaid color packages sold in December that get used over the next four months. Every transaction touches a different part of the books.
Gyms and studios have their own version. Memberships that bill monthly. Class packs that get bought now and used later. Trainers who might be employees or might be contractors depending on how the relationship actually works. Revenue that spikes in January and settles back to reality by March. High fixed costs that don’t care whether the studio is packed or empty.
Who This Covers
Who This Covers
Hair salons, barbershops, nail salons, spas, massage therapy, tattoo studios, gyms, CrossFit boxes, yoga and pilates studios, dance studios, martial arts schools, personal training. Any business in beauty, fitness, or wellness.
What Makes It Different
What Makes It Different
Booth renters versus employees requiring different tax treatment. Tips flowing through your books that aren’t your income. Memberships and packages creating revenue you haven’t earned yet. Commissions, class rates, and split structures that make payroll complicated.
What We Handle
Monthly bookkeeping with revenue separated by type. Service income, memberships, class packs, retail sales. Each tracked differently because each works differently. Prepaid packages recorded as a liability until the service is delivered, not as income the day someone pays.
Payroll that handles tips correctly, processes commissions without manual calculations every pay period, and keeps employees separate from contractors. Booth renters get 1099s. Staff gets W-2s with tips reported properly. The IRS has specific opinions about who qualifies as what, and getting it wrong is expensive.
Worker Classification
Worker Classification
Booth renters documented as contractors. Employees on payroll with tips withheld correctly. Clear separation so you’re not explaining to the IRS why someone who works your schedule with your tools got a 1099.
Revenue Recognition
Revenue Recognition
Memberships and packages recognized as income when services are delivered, not when payment is collected. Your P&L reflects real monthly performance instead of wild swings based on when people prepaid.
Common Problems
Worker classification is where salons and studios get into trouble. You call someone a booth renter, but they work your hours, use your products, and you tell them how to do the job. That’s an employee, and when the IRS figures it out, you owe back payroll taxes plus penalties for every year you got it wrong.
Gyms have a different problem. January looks incredible. Sign-ups everywhere, cash flowing in, the year looks promising. By April, half those resolutions have quit and you’re back to baseline. If you spent January’s cash like it was the new normal, February through June gets tight.
Misclassified Workers
Misclassified Workers
Treating employees as contractors to avoid payroll taxes. It works until it doesn’t. An audit reveals the misclassification and suddenly you owe years of back taxes, penalties, and interest.
Seasonal Blindness
Seasonal Blindness
Mistaking the January rush for the new normal. Making spending decisions based on peak month revenue. Running short when the predictable slowdown arrives.
What Changes
Workers classified correctly from the start. Documentation that supports the classification if anyone asks. Payroll that handles tips and commissions without creating extra work every pay period. No exposure to audits questioning why your booth renters look a lot like employees.
Revenue that reflects reality. Memberships and packages spread over the period they cover. Seasonal patterns visible in the numbers so you can plan around them instead of being surprised. You know what the business actually makes each month, not what it looked like on the day people paid.
Compliant Structure
Compliant Structure
Clear separation between employees and contractors. Tips reported correctly. Commission structures documented and calculated automatically. No classification issues waiting to surface during an audit.
Real Performance Data
Real Performance Data
Monthly financials that show actual business performance. Seasonal trends visible. Cash flow planning based on what’s predictable, not what’s hoped for. Decisions made with real numbers.
Northwest Ohio’s Trusted Bookkeeping Partner
The Next Step:
A 15-Minute Discovery Call
Let's talk about your current bookkeeping situation. We'll assess your needs, outline a plan of action, and give you a clear quote.
