The End of Domicile – how footballers are impacted by a shift in the UK tax regime

Morag Ofili of our Tax team considers the implications for footballers and the Premier League of the end of domicile within the UK tax system in the latest edition of legal know-how journal The Reporter.

The Autumn Budget announced the end of domicile and its associated tax benefits. The concept of domicile has long been a cornerstone of the UK tax regime, providing a framework for determining individuals’ liability to UK tax on worldwide income and gains (the concept remains for family law, estate, death taxes and IHT treaties). For highly mobile individuals, such as professional footballers, domicile has served as a crucial determinant in shaping their tax obligations and planning strategies. This article discusses how the end of domicile creates unique tax challenges for footballers.

The current role of domicile in taxation

In the UK, domicile is distinct from tax residency. While residency determines where an individual is taxed based on where they spend time or maintain ties, domicile relates to the individual’s long-term intentions and origin.

Domicile status underpins key tax benefits for non-domiciled individuals (non-doms). Over 60% of Premier League players are foreign nationals, making the benefits of the concept of domicile a cornerstone of tax planning in the industry. It can assist with:

• Remittance planning: A non-domiciled player living in the UK can avoid UK tax on income and gains earned abroad, provided they are not remitted to the UK. This is critical for players with endorsements, investments, or image rights contracts structured internationally.
• Inheritance tax: Non-domiciled players may also limit their exposure to UK inheritance tax on worldwide assets, a consideration for those with significant wealth spread across multiple jurisdictions…

 

Subscribers to The Reporter can read the full article in the January-February 2025 issue, from page 128 – more details here.

This article was based on Morag’s original client briefing here.