Budget 2014 – Sporting tax breaks extended
The Budget measures have confirmed that a special exemption from UK Income Tax will apply to non-UK residents sportspersons’ income related to their appearance at the Glasgow Grand Prix which is due to take place between 5 July and 14 July 2014. Under UK tax rules a sportsperson not resident in the UK would usually be subject to UK Income Tax on UK earnings including a proportion of any worldwide endorsement income. This move is meant to help attract top international athletes to compete at the sporting events.
The exemption also applies to the 2014 Commonwealth Games, officially known as the XX Commonwealth Games, that will be held in Glasgow from 23 July to 3 August 2014. Athletes from outside the UK will be exempt from UK Income Tax on any payment in connection with their performance in the UK.
The athletes will remain liable to tax in the country in which they are resident and the tax break is for competing non UK resident athletes only. The fact that exempted athletes are not required to complete tax returns on the UK will be welcomed by affected individuals.
In addition, the Government has announced that new powers will be introduced that will allow for future exemptions to be made for major sporting events using secondary legislation. This will remove the requirement to legislate for such provisions in a Finance Bill.