Premier League clubs are bracing for higher wage costs after the UK government confirmed in its latest budget that image rights payments will be taxed as income from April 2027.
Currently, many players receive part of their earnings through image rights paid to limited companies, which are taxed at the 25% corporate rate. Under the new rules, these payments will instead be subject to the 45% top income tax rate — a major increase for many top-flight footballers.
Agents say players signing new contracts are likely to demand higher wages to offset the extra tax, with some clubs expected to absorb the cost. Many contracts are negotiated on a net-pay basis, meaning clubs already handle players’ tax burdens directly.
Some overseas players reportedly have clauses requiring their clubs to cover any major tax changes. Those who do not are expected to push for revised deals.
Image rights arrangements, which can make up to 20% of a player’s total earnings, have long been targeted by HMRC as part of a wider crackdown on football-related tax avoidance.
Prof Rob Wilson of Sheffield Hallam University said the tax overhaul will bring “fairer taxation” and improve transparency around wage bills, though clubs may face “short-term pain” as they adapt.
