12 March 2012 at 17:37 BST

Man United settles image rights tax bill

It's been a case of 'good news, bad news' for football club Manchester United in the last few days.

Old Trafford: the taxman cometh

Wayne Rooney and his high-earning team-mates hit the top of the Premier League after a win against West Bromwich Albion, but the last few days have also seen their club settle a multi-million pound tax bill.
The agreement between the new league leaders and the UK’s Revenue & Customs over the controversial payment of image rights revenue ends a battle that has dragged on for almost a decade.


Mr Rooney -- never one to be out of the spotlight for long -- is a key player in the image rights game. In a separate court case in 2010, nearly a quarter of Mr Rooney’s contracted £6.2 million salary was shown to come through image rights, according to The Times newspaper. The British taxman launched a crackdown on that type of payment, considering the scheme effectively to amount to tax avoidance.
HMRC says many top players exploit image rights payments as a way to receive a proportion of their salary through a separate company, possibly offshore, at a lower rate of income tax.
Manchester United has not revealed the terms of the settlement, but The Times reports it is expected to be less than the £6.4m declared by fellow Premiership club Chelsea last year.

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Pete Hackleton, senior tax manager in the sports and entertainment group at London-based accountants Saffery Champness, defended the sport, telling the newspaper: ‘It should be remembered that in the 2011-12 season, the Premier League is likely to contribute in excess of £1 billion to the exchequer.’

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