Tax question.

[si the fire]

Not sure if this should be sport or finance question, but here goes, Chelsea have just signed a new German football player who is reported to be on �130,000 a week, now i persume a lump of that goes in tax, who does he pay his tax to, the U.K Taxman being that he ply's his trade here or the German taxman as he is a german citizen,

thanks,

Si

[dzug]

Residence is usually (but not invariably) more important than citizenship for tax purposes.

My guess is he'll pay tax here, and if the tax in Germany would be more, he'll pay the difference there if he retains residency. But ICBW.

[si the fire]

I bow to your superior knowledge dzug, thanks for your quick reply,

Si

[kags]

The residency rules are complicated, but essentially if he has come to live and work here, he will be taxed at the normal UK rates. There may be rules within the German tax system which mean he is also liable there, but there is a Double Taxation Agreement between the 2 countires to ensure he is not taxed twice.

[si the fire]

All i was thinking when i posted the question was , who was going to benefit more from his services, Chelsea, or the Taxman..

[Gef]

Most high earning footballers don't pay tax. The figures quoted are net pay as the club has already paid the tax to the Inland Revenue.

[deso]

To clarify what Gef means, they'll probably have a "net pay" type contract with the club that guarantees an agreed amount "in their pocket" every week. The club then calculate what the gross amount would have to be and the difference is paid in tax - but it's the gross amount the player would have to include on his personal tax return.