UK tax laws repel top athletes

But this might be about to change.

Hydration, shoes, sponsorship, training, diet… tax rules? The last item in that list will not have been weighing heavily on the minds of many runners in the London marathon last weekend.

They are, however rather more of a consideration for international athletes competing in UK pro-sports events. Thanks to current Treasury policy, entry could easily leave them seriously out of pocket.

The HMRC Foreign Entertainers Unit levies tax on foreign sportsmen and women not simply by reference to earnings made from the events they enter the UK to take part in, but also by looking at global sponsorship income.

At the highest levels of sport, the majority of annual earnings are in the form of such sponsorship arrangements. Sellers of training equipment, drinks, perfumes, watches — even broadband (thank you, Mr Branson) — want a sprinkling of top quality athletic shimmer to help shift their wares. The remuneration for many such favoured athletes makes some of their event winnings look positively mean by comparison.

The UK and US revenues are alone in plundering this branding income of international guests at their championships, matches, games, and competitions — with the result that participation in UK events can appear on stars’ books as a loss-making endeavour.

This policy has in recent years found many top athletes deciding against entering UK events. There is a difficult call to be made as to whether the reputational capital they accrue from appearing in UK events is worth the tax payable. The value a major sponsor may put on their man’s profile in the UK is often quite intangible; the prospect of a bill from HMRC running to tens, or even hundreds of thousands of pounds, is not.

This difficult decision has been averted, however, for two upcoming athletics meetings as after years of lobbying by the sports industry, the Treasury has at last issued a concession to their policy. Buried in the 629 pages of Finance Bill 2013 (only slightly down from last year’s record-breaking 686) lie two clauses that grant exemptions from income tax to accredited competitors at the 2013 Olympic Anniversary Games and 2014 Commonwealth Games. News that Usain Bolt will make his first non-Olympic UK appearance in four years indicates the concession is timely.

This year’s concession is stand-alone, but could augur wider change. The case has long been made that UK plc loses out from its current approach to international sport. The Treasury may see the arrival to our shores of itinerant stars as a cash cow to be milked, but the taxes raised are coming at the expense of more significant opportunities (including the 2010 Champions League final which went to Madrid instead).

The economic rally of Q3 last year demonstrated the value to the UK of hosting international sport. Stand-alone tax breaks encourage competitors to help make such events the international displays of expertise they should be. However, the fiscal atmosphere surrounding them remains tense and the UK could benefit hugely from a permanent softening of its policy.

Edward Keene is from private client law firm Maurice Turnor Gardner LLP. This story first appeared on Spear's magazine

Usain Bolt. Photograph: Getty Images

This is a story from the team at Spears magazine.

Photo: Getty
Show Hide image

Jeremy Corbyn sat down on train he claimed was full, Virgin says

The train company has pushed back against a viral video starring the Labour leader, in which he sat on the floor.

Seats were available on the train where Jeremy Corbyn was filmed sitting on the floor, Virgin Trains has said.

On 16 August, a freelance film-maker who has been following the Labour leader released a video which showed Corbyn talking about the problems of overcrowded trains.

“This is a problem that many passengers face every day, commuters and long-distance travellers. Today this train is completely ram-packed,” he said. Is it fair that I should upgrade my ticket whilst others who might not be able to afford such a luxury should have to sit on the floor? It’s their money I would be spending after all.”

Commentators quickly pointed out that he would not have been able to claim for a first-class upgrade, as expenses rules only permit standard-class travel. Also, campaign expenses cannot be claimed back from the taxpayer. 

Today, Virgin Trains released footage of the Labour leader walking past empty unreserved seats to film his video, which took half an hour, before walking back to take another unreserved seat.

"CCTV footage taken from the train on August 11 shows Mr Corbyn and his team walked past empty, unreserved seats in coach H before walking through the rest of the train to the far end, where his team sat on the floor and started filming.

"The same footage then shows Mr Corbyn returning to coach H and taking a seat there, with the help of the onboard crew, around 45 minutes into the journey and over two hours before the train reached Newcastle.

"Mr Corbyn’s team carried out their filming around 30 minutes into the journey. There were also additional empty seats on the train (the 11am departure from King’s Cross) which appear from CCTV to have been reserved but not taken, so they were also available for other passengers to sit on."

A Virgin spokesperson commented: “We have to take issue with the idea that Mr Corbyn wasn’t able to be seated on the service, as this clearly wasn’t the case.

A spokesman for the Corbyn campaign told BuzzFeed News that the footage was a “lie”, and that Corbyn had given up his seat for a woman to take his place, and that “other people” had also sat in the aisles.

Owen Smith, Corbyn's leadership rival, tried a joke:

But a passenger on the train supported Corbyn's version of events.

Both Virgin Trains and the Corbyn campaign have been contacted for further comment.

UPDATE 17:07

A spokesperson for the Jeremy for Labour campaign commented:

“When Jeremy boarded the train he was unable to find unreserved seats, so he sat with other passengers in the corridor who were also unable to find a seat. 

"Later in the journey, seats became available after a family were upgraded to first class, and Jeremy and the team he was travelling with were offered the seats by a very helpful member of staff.

"Passengers across Britain will have been in similar situations on overcrowded, expensive trains. That is why our policy to bring the trains back into public ownership, as part of a plan to rebuild and transform Britain, is so popular with passengers and rail workers.”

A few testimonies from passengers who had their photos taken with Corbyn on the floor can be found here