[Football] HM Revenue & Customs investigates players, clubs & agents over tax

[Shropshire Seagull]

Tax is my field. Stealth taxes and tax in general have been rising, £ per £ of income, steadily over the last 21 years for middle and higher earners. Anyone here who runs a one or two man limited company will confirm this. For every penny drop in corporation tax, the government have been taking far more than that in an array of income tax bands/rates on dividends. All classes of national insurance, cost far more £ for £ of income or self employed profits than they did 21 years ago.

IHT and CGT yields many times what it used to, due to rises in asset values, plus the removal of aspects in the taxpayers favour.

Lastly, most forms of tax planning and schemes have been manditarily closed down by very tight legislation.

Fair enough. With a rapidly ageing population, the costs for the NHS, state pensions and welfare, all need paying for.

I concur, so rather than be thoroughly shafted, tax-wise, [thanks to IR35] I have elected to voluntary strike-off [close down] my limited company this year and seek early retirement [end of this year]. Despite working many years for both HMRC and its primary service providers, I want to [legally] retain as much of my hard-earned wonga as possible and share only what I absolutely have to, to contribute to the tax-pot.

Does this make me a bad citizen?

 

[Shropshire Seagull]

This is not really news. Footballers and Agents are like any profession. They have their share of tax Enquiries.

I would challenge this - the football profession will have a disproportionately higher number of tax inquiries.
This is because HMRC will consider "potential yield" before instigating a tax inquiry - to make best return on investigation effort / costs.
So, by the nature of monies involved, professions like electricians, plumbers, bricklayers and the like are far less likely to be a target for investigation from HMRC than big money business like professional football.

 

[Weststander]

I concur, so rather than be thoroughly shafted, tax-wise, [thanks to IR35] I have elected to voluntary strike-off [close down] my limited company this year and seek early retirement [end of this year]. Despite working many years for both HMRC and its primary service providers, I want to [legally] retain as much of my hard-earned wonga as possible and share only what I absolutely have to, to contribute to the tax-pot.

Does this make me a bad citizen?

You played by the rules/law at the time, so you're a great citizen. The goalposts were moved later.

 

[SAC]

HMRC's enquries into footballers tax affairs, yielded £73m for 2019/20, double that for 2018/19.

246 players, 55 agents/fees paid to them and 25 clubs were/are under enquiry for 2019/20.

https://www.skysports.com/football/news/11095/12045846/hmrc-investigations-into-footballers-tax-affairs-treble-in-past-year?mid=107812310&rid=6645861&cid=DM226573&market=GB®ion=UK&campaignlabel=Media%20AB%20Direct

Cumulatively, £464m has been collected by HMRC over the 6 years to 2019/20, directly resulting from their investigations into the professional football industry.

That's good news. The players, agents and clubs who did anything wrong should be named and shamed to hopefully prevent it happening in the future.

 

[NooBHA]

I would challenge this - the football profession will have a disproportionately higher number of tax inquiries.
This is because HMRC will consider "potential yield" before instigating a tax inquiry - to make best return on investigation effort / costs.
So, by the nature of monies involved, professions like electricians, plumbers, bricklayers and the like are far less likely to be a target for investigation from HMRC than big money business like professional football.

I was in a Consultation Course only a few weeks ago where the HMRC Inspectors who deal with tax enquiries into Footballers and Agents were present. HMRC stated exactly how many open enquiries they have open at this point in time. That post of mine was before I went on that Course and I can categorically state now. They actually have a lot less open cases than I thought they would have.

Tax Enquiries in the Football Industry and the Music Industry are quite Specialist. I deal with both and HMRC don't have enough Inspectors with the Expertise to open much more than they have open at the moment.

They are homing in on the Club's a lot more now threatening them with all sorts of they don't comply with certain directives.

 

[trueblue]

HMRC's enquries into footballers tax affairs, yielded £73m for 2019/20, double that for 2018/19.

.

So I think that's 15m quid less than they've just fined the government's own Department of Work and Pensions for unpaid tax & NI after failing to implement ir35 properly. But no doubt footballers will get a lot more flak.

As someone now being forced into 'false employment' by risk averse clients and consequently on the brink of giving up work I've grafted for years to build up (all sporadic, with no guarantees or employee benefits), I feel qualified to say the whole system has become a farce. As well as the money they're legally entitled to, HMRC seem very happy to let large companies make up the rules as they go along and deduct tax that isn't due, knowing full well most small operators have little choice but to accept the work that's available on whatever terms are imposed.

 

[Weststander]

So I think that's 15m quid less than they've just fined the government's own Department of Work and Pensions for unpaid tax & NI after failing to implement ir35 properly. But no doubt footballers will get a lot more flak.

As someone now being forced into 'false employment' by risk averse clients and consequently on the brink of giving up work I've grafted for years to build up (all sporadic, with no guarantees or employee benefits), I feel qualified to say the whole system has become a farce. As well as the money they're legally entitled to, HMRC seem very happy to let large companies make up the rules as they go along and deduct tax that isn't due, knowing full well most small operators have little choice but to accept the work that's available on whatever terms are imposed.

FWIW, the trotted out line that HMRC only pick on poor builders and taxi drivers, and let the big/medium companies and the wealthy off is a myth.

In January to March this year alone, HMRC raised an extra £14.2bn from its compliance work. Money that would’ve slipped through the net without the policing of fraudsters and immoral schemes devised by savvy folk creating ‘arrangements’ with the sole purpose of depriving us of tax revenues. In an online professional publication once a year, in the past I’ve seen the analysis of the total extra tax take …. that is, which categories have been caught. It’s everyone ranging from multinationals, wealthy individuals, large UK companies to small businesses/individuals. HMRC set up a Wealthy Individuals department about 5 years ago, from what I’ve seen, the inspectors are very switched on, asking all the right questions then tying up answers to evidence they have from elsewhere.

IR35 - my personal view is:

For genuine entrepreneurs or those taking risks, with no security, truly able to control their day and week, they shouldn’t be deemed under the rules.

For those who are de facto employees, such as famously the John Birt arrangements, then IR35 is right. I’ve known folk working 40 hour weeks for the same entity for long periods, with no other ‘clients’, expected to be on site three to five days a week, part of the firms hierarchy. Typically in IT, major project management or advertising. The employer saved employers NI and onerous employer responsibilities, the ‘employee’ a fortune in NI and tax. Without some sort of legislation, it would be a Wild West, the nations tax take diminished.

 

[Paulie Gualtieri]

FWIW, the trotted out line that HMRC only pick on poor builders and taxi drivers, and let the big/medium companies and the wealthy off is a myth.

In January to March this year alone, HMRC raised an extra £14.2bn from its compliance work. Money that would’ve slipped through the net without the policing of fraudsters and immoral schemes devised by savvy folk creating ‘arrangements’ with the sole purpose of depriving us of tax revenues. In an online professional publication once a year, in the past I’ve seen the analysis of the total extra tax take …. that is, which categories have been caught. It’s everyone ranging from multinationals, wealthy individuals, large UK companies to small businesses/individuals. HMRC set up a Wealthy Individuals department about 5 years ago, from what I’ve seen, the inspectors are very switched on, asking all the right questions then tying up answers to evidence they have from elsewhere.

IR35 - my personal view is:

For genuine entrepreneurs or those taking risks, with no security, truly able to control their day and week, they shouldn’t be deemed under the rules.

For those who are de facto employees, such as famously the John Birt arrangements, then IR35 is right. I’ve known folk working 40 hour weeks for the same entity for long periods, with no other ‘clients’, expected to be on site three to five days a week, part of the firms hierarchy. Typically in IT, major project management or advertising. The employer saved employers NI and onerous employer responsibilities, the ‘employee’ a fortune in NI and tax. Without some sort of legislation, it would be a Wild West, the nations tax take diminished.

Still waiting for the HMRC view on whether Uber owe them c£1B in backdated VAT after a legal challenge via crowd funding was lodged


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[trueblue]

for… those taking risks, with no security, truly able to control their day and week, they shouldn’t be deemed under the rules.

I’d put myself and colleagues (who are also rivals) in that category. Freelancers, hugely competitive industry where new work is not easy to come by, fees paid only for work done with no guarantees even once it’s booked, no employee benefits whatsoever on pay rates that haven’t risen for a decade or more. And yet we’re all scrabbling around now trying to find the few shifts that won’t be taxed at source, while also trying to protect the work & contacts we’ve built up. So dispiriting. I suspect plenty will pack it in - certainly feel like it myself, even though the job has been my whole life pretty much. I agree (well, I’ve read) that plenty of contractors were taking the piss but they’ve simply thrown the net over all of us now by getting big companies to implement over-zealous restrictions. It’s become a nightmare. If HMRC were going to be fair about it, they’d have built some meaningful protections into the process. The ‘right of appeal’ etc is a waste of time when you’re dealing with risk-averse multi-nationals.

 

[Birdie Boy]

I would challenge this - the football profession will have a disproportionately higher number of tax inquiries.
This is because HMRC will consider "potential yield" before instigating a tax inquiry - to make best return on investigation effort / costs.
So, by the nature of monies involved, professions like electricians, plumbers, bricklayers and the like are far less likely to be a target for investigation from HMRC than big money business like professional football.

They are clearly not less likely to target lower earners as I have a bill for £2.63 which is interest from 2006! Hopefully Hmrc will be targeting people who have had numerous grants in the last year or so that have no intention of paying it back by closing their companies down.

 

[Weststander]

They are clearly not less likely to target lower earners as I have a bill for £2.63 which is interest from 2006! Hopefully Hmrc will be targeting people who have had numerous grants in the last year or so that have no intention of paying it back by closing their companies down.

And the Furlough fraudsters. £bn’s paid out to firms where the staff (not part of the scam) carried on working, or not passed on to the staff at all.