Football and Non-Dom

Errm, how does this work then?

So why do overseas players now dominate? As the supposedly economically competent Gordon Brown would understand, it\’s because they enjoy a huge and unfair competitive advantage over British players. Tax rules allow foreign players to claim \’non-domicile\’ status and, with the help of clever lawyers, pay 40 per cent less tax than their British rivals on much of their income.

Non-doms only pay less tax than doms on that portion of their income which is earned abroad. Playing in the Premiership is prety clearly working in the UK. So in thei competition with English players playing in the Premiership the non-dom foreign players don\’t actually have a tax advantage, do they?

6 comments on “Football and Non-Dom

  1. Are clubs paying salaries direct to players or making payments to off-shore companies in return for the use of particular players? If the latter, such companies could obviously limit the amount of money paid directly to the player, and thus taxable in the UK. And presumably payments for housing, cars etc can be constructed as tax-deductible expenses by such companies.
    Another thought – is it possible to structure payments per game, with the biggest due on UEFA games outside the UK, and thus avoid tax in that way?

  2. If Chris really had John Riise’s pay statement then it actually appears fairly straightforward.

    Also, during a previous life, I was involved in a number of football club investigations and didn’t see any shenanigans of the sort James is suggesting. Of course, I didn’t get the secondary ledger out from behind the humidor …

  3. I believe it works this way. A footballer like Christiano Ronaldo has three contracts with his club.

    One for all games in the UK – on this he pays the top rate of tax as these are his UK earnings.

    One contract for European away games

    One for international image rights

    The last two are not UK earnings so non dom becomes relevant. So the UK tax system makes the premiership a more attractive destination for top overseas players. But it only really applies to the big 4. I guess without non dom it would cost the clubs more to attract the foriegn players so they might choose English players instead. But I don’t believe it.

  4. The whole argument is stupid. If clubs were hiring foreign players because they were cheaper (due to tax savings) we would be seeing foreign players in the Premier league who are worse, on average, than English players, and England would be regularly winning Euro competitions. And some enterprising club, realising this, would take the gap in the market, pay its all-English players more for the season it takes to win all the English leagues, and then take the lion’s share of the TV rights for the next year.

    The sad truth is that the Premier league is full of foreign players because they are better than the English players, and the clubs, being businesses, hire the best regardless of their nationality. The results of the England team confirm this.

  5. What James & Richard say, this non-dom is not an exemption from tax, but you can tweak it quite a lot. Whether that explains why our footballers are crap is a different issue.

  6. Non-doms pay income tax on non-uk source income when it is remitted to the UK; if it isn’t, they don’t.

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