Image rights: Altered images – will the Government shift the goalposts on image rights?


Andy Wood

Andy is a practical, creative tax adviser who assists a variety of clients in achieving their personal and commercial objectives in the most tax efficient manner.

Image rights: Altered images – will the Government shift the goalposts on image rights?

Even many of those who don’t regard themselves as football fanatics are familiar with the fact that England’s sole World Cup win came on home soil in 1966.

Through “years of hurt” stretching across the intervening half-century, the domestic game’s biggest stars have been left empty-handed, at least in terms of scooping the sport’s most celebrated team prize.

Since the launch of the Premier League in 1992, they have been rather more successful, though, chasing the golden rewards of life with one of the more renowned and gilded big clubs.

According to a definitive annual study of football finance, players representing sides in England’s top flight pocketed a total of £2.5 billion in wages over the course of the last financial year.

Unsurprisingly, the sums have been eyed covetously by politicians and HMRC alike.

Last year, the House of Commons’ Public Accounts Committee expressed its horror at the fact that footballers weren’t paying more tax, concluding that the “rules on ‘image rights’ as they are applied in football…are being exploited”.

In doing so, the Committee was merely touching a raw nerve for HMRC. It had harboured a grievance about clubs’ remunerating stars for the use of their image in commercial deals even before it lost a milestone 2000 court case featuring Arsenal legends Dennis Bergkamp and David Platt.

The players – who were given the respective pseudonyms ‘Evelyn’ and ‘Jocelyn’ in a failed attempt to keep the dispute off the back pages of the nation’s newspapers – had received separate payments from Arsenal for their off-field image rights engagements and what they did on the pitch.

An argument from the Revenue that the image rights cash should be subject to Income Tax and National Insurance Contributions (NICs) as salary was rejected by the Courts.

Ever since, an uneasy truce has persisted as football’s income from TV and sponsorship deals has spiralled ever higher.

Much of that has found its way to the highest-profile players, such as Paul Pogba of Manchester United. One  recent report estimated that a £3 million share of his £23 million annual income was down to image rights.

During one parliamentary inquisition, HMRC’s Chief Executive, Jon Thompson, outlined an ongoing dialogue with more than 50 English and Scottish clubs in an effort to determine “some sort of reasonable threshold” when it comes to the scale of image rights payments.

The fundamental idea of those talks is that there should be some reality to the sums involved. Why, for instance, should a journeyman pro receive the same proportion of his overall income from image rights as an established household name?

As the pressure from MPs has grown more acute, the civility of such an arrangement has appeared at breaking point. Last year, I was asked my opinion of a series of HMRC raids on a number of Premier League clubs in connection with what the Revenue described as “tax fraud”.

Within the last week, it’s also emerged that 171 players, 44 clubs and 31 agents are currently being investigated by HMRC for “range of issues, including image rights abuse”.

Furthermore, the Revenue’s crackdown on tax compliance in football has generated £332 million in “extra tax” since 2015.

To use one phrase common to many post-match interviews, “at the end of the day” those figures may seem satisfactory but I believe that HMRC may well push even harder.

In addition, football doesn’t need to look very to see that the Revenue is just as dogged as the most persistent of midfield scrappers.

Only last year, a lengthy campaign to tackle the use of so-called ‘disguised remuneration’ structures, such as Employee Benefit Trusts (EBTs), culminated in a Supreme Court win which could mean hardship for some notable former players, as I remarked at the time to Accountancy Age.

It demonstrated that HMRC plays a very long game, remaining focused on single issues of interest for a considerable period of time.

With MPs demanding HMRC enter into discussions with the Treasury “with a view to reforming the current law on image rights.”, it shows another common tactic. What it cannot gain in the courts, it will seek to achieve by moving the goalposts and use the Statute Book instead.

In my view it is only a matter of time before the legislation is changed such that image right payments paid by the clubto one of their players will become subject to PAYE.

Indeed, perhaps this could be outside bet for Mondays budget?

However, that would still enable a player to benefit from payments from major international brands, who are willing to pay to use their image and name in their advertising, in the same manner.

It could be said that there are, of course, other, more pressing political priorities for Westminster to consider right now. But with the Government looking for extra revenue, and this seemingly a change that wouldn’t cause too many negative headlines, it should not be ruled out.

Our earlier articles on image rights can be found here:

  • Are HMRC dropping the ball or parking the bus on image rights – Part one
  • Are HMRC dropping the ball or parking the bus on image rights – Part two
  • Andy Wood talks to Sky Sports about the Spanish Authorities finding big name footballers guilty of tax evasion


If you have any queries around image rights or any other tax matters then please get in touch.

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