Salary Cap

Quote: Bullseye "As I undertsand it a club owner could get a third party to pay a player or a player's partner for "services rendered". It would be taxable and fair enough in terms of UK law but never come within a mile of being audited by the RFL for salary cap purposes.

The result is that the salary cap audit says the club is under the cap. Meanwhile players and their partners receive loads extra from other sources for "non playing activities".

I've nothing against payment made to players when it's obvious where they come from. With Tomkins that seems fairly straightforward. It's where a side has internationals in every position, comes in under the cap yet those players seemingly have no other sources of income that I and others get suspicious.'"

The salary cap auditor has discretion to include anything else that looks like part of a player's package (can't quote the exact Rule this minute but will if required later). If it looks like a payment to a player, and it walks like a payment to a player, and it quacks like a payment to a player, then it probably IS a payment to a player - sort of idea. In the case of Harris, for example, it seems the SC auditor DID determine there was a connection to the club from image rights paid by an unconnected third party.

The hard part is identifying the payment in the first place (although a club should have no reason not to disclose a genuine third-party image rights deal for a Tomkins-type player), and then establishing a connection to the club.

Genuine third party deals are fine under the cap rules.

Where the deal is arranged by the club for the player, especially where the third party might otherwise have become a club sponsor or similar anyway, then it starts to get very grey, I suggest?

And if - heaven forbid - a wealthy club owner should get his mate to set the player's missus up in a lucrative job, or pay the player's personal services company a shedload for his image rights or whatever, and then said club owner sees his mate right in some other deal...well what do you think?

And as for a wealthy club owner paying monies to players or otherwise remunerating them out of one of his other business interests, and not disclosing that to the SC auditor, well that would be just beyond the Pale, would it not.

Thankfully, we can rest assured that all club owners and investors are honourable people, who would never wish to be considerd unsporting or cheats, and so would never stoop to such tactics. Otherwise we'd see a very unlevel playing field in the game.

Incidentally Sam, scrub that silly idea of it being taxable. If its for an overseas player, said player will invariably be a non-dom unless he puts dowm pretty permanent roots here. That means that a club - or a third party - can pay the player's offshore personal services company (resident in Bermuda or Guernsey or Grand Cayman or wherever) for the player's services (of any nature, but usually its things like image rights), and as long as the player does not draw income from the company AND remit it to the UK, he escapes UK tax and NIC. Because whilst he is resident for UK tax purposes he is a non-domiciled and therefore only taxable on income earned in the UK or remitted to the UK.

And then, just as he has permanently left the UK on his way back home, but BEFORE he lands back home, get the old Singapore Sling out and wang the money back home ahead of him. So it lands back home before the player becomes resident for tax purposes again back home, and so he escapes tax there too. (they may have stopped the simplistic devices now, but there will be others).