Chelsea FC have paid £6.4m to settle an investigation by Revenue and Customs into player payments. The settlement arose from an investigation into ‘image rights’ payments in football.
These provide a means by which players can reduce their tax bills. They get two contracts from their club, one for their salary as a player and the other for earnings from replica shirts and other merchandise. These royalties are paid into a company and are therefore liable for corporation tax which is lower than income tax.
Chelsea FC have paid £6.4m to settle an investigation by Revenue and Customs into player payments. The settlement arose from an investigation into ‘image rights’ payments in football.
These provide a means by which players can reduce their tax bills. They get two contracts from their club, one for their salary as a player and the other for earnings from replica shirts and other merchandise. These royalties are paid into a company and are therefore liable for corporation tax which is lower than income tax.