They think it’s all over … it is now! Are the changes to non-dom status an own goal against our footballers?

January is a gloomy month. 

Christmas decorations packed away, relentless LinkedIn posts about ‘goals for the new year’ and your best mate has swapped a night down the boozer for a detox retreat with refillable celery smoothies. 

For the football agents, however, it is a very different story. 

Ladies and gentlemen, the transfer window is now open.  It is time to get down to business.  

But will the fundamental changes to tax treatment of ‘non doms’ delivered in Labour’s first budget, which are likely to affect some of the Premier League’s highest profile stars, cool the market? And what family law advice might be relevant for players with itchy feet in their boots?

An excellent and detailed consideration of the October 2024 budget can be found in Miranda Fisher’s article: Consequences of the abolition of the non-dom regime and 30 October 2024 Budget: what are the family law issues for wealthy clients leaving the UK? 

Current rules – back of the net …

Under the current rules, footballers are taxed on their wages earned in the UK.  However, monies earned overseas and paid into foreign bank accounts – image rights, brand sponsorship, appearance fees, to name but a few potential income streams – would only be taxed if remitted into the UK. 

This is clearly an attractive regime for international stars plying their trade in the Premier League. 

Red card for the remittance basis

But Rachel Reeves has blown the full-time whistle on this remittance basis of taxation: from April 2025, players who have been resident in the UK for four years or more will generally be fully taxed on all offshore income and gains. 

This will result in a greatly increased tax bill for many of our international stars. 

My colleague Sophie Dworetzsky was featured in a City AM article discussing the potential impact of non-dom changes on high-profile footballers: City AM quotes Sophie Dworetzsky on the potential impact of non-dom changes on high-profile footballers

Potential impact

Money talks in football. 

It follows that the tax treatment of players in any given country is highly relevant to attracting and retaining the game’s biggest names. 

At a time when big pay cheques and low tax rates are available to players in Saudi Arabia, for example, many agents believe this change in the UK tax regime may result in shorter-term contracts or players not moving to the Premier League at all. 

It seems clear, however,  the Premier League will always be a massive draw for players because – put simply – it is the best league in the world.   A significant drop-off in recruitment of global stars of the game seems unlikely. But for a certain category of player, perhaps coming to the end of their career and looking to maximise earnings before a long retirement of reducing their golf handicap and lamenting the mistakes of former colleagues on MOTD, this change in tax treatment will no doubt give pause for thought. 

Post-match analysis 

Specialist legal advice will be crucial not just in terms of tax structuring but for those players looking to leave the Premier League and other UK leagues, there are important family law issues to carefully consider: 

1. If the player wishes to relocate with children, the agreement of both parents or a court order will be needed.
2. If children are to remain in the UK (because they are settled in school, for example), are there arrangements in place for the children to spend time with the relocating player both in school term and holidays?
3. If the player and their spouse have entered into a nuptial agreement (before marriage, called a pre-nuptial agreement or after marriage, called a post-nuptial agreement), will the terms of that agreement be enforceable if the marriage breaks down and divorce proceedings are initiated in the destination country?
4. If the player and their partner or spouse are separated or likely to separate but have not reached a financial agreement, are the laws of the destination country likely to have a material impact on any financial claims arising in connection with the breakdown of the relationship?
5. If issues regarding children and/or finances need to be resolved before any relocation, that should if possible be done in a discrete and confidential forum: mediation, arbitration and private court hearings are possible options, depending on the circumstances. 

Again, advice should be obtained by family law specialists experienced in representing athletes and other professionals in the sports sector.