FOOTIE clubs and players coughed up a record £165.8 million in unpaid tax last season, according to figures obtained by The Sun on Sunday. This includes £124.8 million from clubs and an astonishing £37.7 million from individual players. These figures represent the highest amount recovered since a tax avoidance probe into the sport was launched in 2015.
The investigation into tax avoidance in football has intensified, with a record 384 footballers currently under investigation, up from 329 the previous year. In addition, 27 clubs and 82 agents are also being probed for potential tax avoidance.
The Premier League, known for its high-profile players and lucrative transfer deals, has seen significant contributions to the unpaid tax figure. Clubs in the Premier League alone spent a staggering £2.44 billion on new players for this season, making them liable for VAT. As a result, many players in the league have paid up to settle their outstanding tax debts.
One notable transfer involved Arsenal paying West Ham £105 million for Declan Rice, while Chelsea topped that with a £115 million deal for Brighton’s Moises Caicedo. These high-value transfers contribute to the overall tax revenue recovered by HM Revenue & Customs (HMRC), which has reached an impressive £725 million.
The focus of the investigation by HMRC is on tax avoidance related to image rights deals. In many cases, cash is paid to a firm set up by a player, which is subject to a lower corporation tax rate of 19% instead of the higher income tax rate of 45%. This discrepancy allows players to potentially avoid paying a significant amount of tax.
In addition to image rights deals, clubs also pay agents commission, which HMRC aims to tax as well. This further contributes to the overall unpaid tax figure recovered by the authorities.
The crackdown on tax avoidance in football is part of a broader effort by HMRC to ensure that all individuals and organizations pay their fair share of taxes. The recovered funds can be used to support public services and infrastructure, benefiting the wider community.
Tax avoidance in football has been a long-standing issue, with numerous high-profile cases in recent years. The authorities are determined to address this problem and ensure that all clubs and players fulfill their tax obligations.
The increase in the number of footballers under investigation highlights the scale of the issue and the need for stricter enforcement measures. By holding clubs, players, and agents accountable for their tax responsibilities, HMRC aims to create a level playing field and maintain the integrity of the sport.
The recovered funds can also have a positive impact on the sport itself. By ensuring that clubs and players pay their fair share of taxes, it helps to create a more sustainable financial environment for football. This can lead to greater investment in grassroots development, youth academies, and community initiatives.
Furthermore, the crackdown on tax avoidance sends a strong message to other industries and sectors. It demonstrates that tax evasion will not be tolerated and that individuals and organizations will face consequences for attempting to avoid their tax obligations.
In conclusion, the record £165.8 million recovered in unpaid tax from football clubs and players last season highlights the ongoing issue of tax avoidance in the sport. The increased number of investigations and the significant amounts involved emphasize the need for stricter enforcement measures. By holding clubs, players, and agents accountable for their tax responsibilities, HMRC aims to create a fairer and more sustainable financial environment for football. The recovered funds can also benefit the wider community by supporting public services and infrastructure. Ultimately, the crackdown on tax avoidance in football sends a strong message that tax evasion will not be tolerated in any industry.