Publication featured in: The Times, City AM, The Daily Telegraph and The i.
The figures mean that one in every 12 professional footballers in the UK* had enquiries opened into their tax affairs by HMRC last year as its crackdown on the sport continues.
HMRC’s key focus in the football industry is the payment of taxes on agents’ fees.
In recent years, it has become common for half of an agent’s fee for the negotiation of a transfer or contract to be paid by the club rather than the player themselves. HMRC has made clear that this is a ‘benefit in kind’ that the player should pay tax on.
Given the scale of the largest football transfers, there is potential for tens of millions of pounds in tax to go unpaid on agent fees alone.
There are also other types of ‘benefit in kind’ payments – such as accommodation for players’ friends and family – that are frequently paid for by clubs and can go untaxed.
For more than ten squads’ worth of players to be investigated in a single year demonstrates the scale of HMRC’s crackdown on football.
HMRC sees the football industry as an easy target. With the sums of money involved in transfers and contracts being so large, there is a great deal of extra tax there to be gathered.
There are some areas of football where non-compliance with tax regulations became widespread. Splitting agent fees between the player and club became accepted practice despite it resulting in HMRC being short-changed. That is now changing very quickly.
* 270 from a total of 3,274 players registered at clubs in the top four divisions in England and Scotland. Source: Transfermarkt