Turning Pro - Tax implication?

[vkurup]

Have a friend who has turned pro (but still holding his regular day job to help pay the bills). He plays on the development circuit. Had couple of Qs from anyone with tax expertise.

1) if a company sponsors him (eg name on bag, tshirt etc) can they claim tax relief or expense on it

2) my assumption is that he should set himself as a company, and then he can set of his expenses like comp fees, travel, equipment, coaching etc against any wins or sponsorships. is this assumption correct or is there a better view. How does HMRC look at this?

Thoughts? (Needless to say all comments considered as comments and not advice - just to preempt Richart's long list of disclaimers . )

 

[CMAC]

The PGA give all pro's advice on this and business, I'd reckon that would be more sensible than taking advice (as well intended as it might be) from an internet forum as the PGA have been doing it for quite some time.

On a personal note- a company I used to work for sponsored a pro for 2 seasons, no tax relief as it was classed as advertising and investments (they expected a return if he did well)

 

[HawkeyeMS]

The PGA give all pro's advice on this and business, I'd reckon that would be more sensible than taking advice (as well intended as it might be) from an internet forum as the PGA have been doing it for quite some time.

This is probably the best advice you'll get on this thread.

 

[Holty]

Agree entirely with the comment above. Tax is a complex subject and it is best to get appropriate professional advice

It is worth bearing in mind that HMRC often look at any expenditure and assess whether it was wholly and necessarily incurred for the purpose of the company when computing profits chargeable to corporation tax.

 

[Deleted member 15344]

As been said - the PGA and HMRC will give you the best advice.

 

[Canary_Yellow]

Have a friend who has turned pro (but still holding his regular day job to help pay the bills). He plays on the development circuit. Had couple of Qs from anyone with tax expertise.

1) if a company sponsors him (eg name on bag, tshirt etc) can they claim tax relief or expense on it

2) my assumption is that he should set himself as a company, and then he can set of his expenses like comp fees, travel, equipment, coaching etc against any wins or sponsorships. is this assumption correct or is there a better view. How does HMRC look at this?

Thoughts? (Needless to say all comments considered as comments and not advice - just to preempt Richart's long list of disclaimers . )

I'd recommend he gets himself an accountant and gets some proper advice based on his exact facts.

However, on the face of it, I don't see why he'd need to set up a company to get relief for expenses, anyone that is self employed is able to do that, so long as the expense is incurred wholly, exclusively and necessarily for the purpose of his business (i.e. being a professional golfer).

There are certain benefits to having a company, but I'm not sure they would work for a playing professional - people would be contracting with him, not his company, surely? I think having a company works from a merchandising perspective and maybe for image rights etc. but probably not just for competition earnings.

However, the best advice I can give is to have him speak to an accountant that is a specialist in the taxation of sports people so that he's in the best possible position from the word go.

The company sponsor should be able to claim relief, again, assuming the expense is wholly and exclusively for the purposes of its trade.

 

[vkurup]

I'd recommend he gets himself an accountant and gets some proper advice based on his exact facts.

However, on the face of it, I don't see why he'd need to set up a company to get relief for expenses, anyone that is self employed is able to do that, so long as the expense is incurred wholly, exclusively and necessarily for the purpose of his business (i.e. being a professional golfer).

There are certain benefits to having a company, but I'm not sure they would work for a playing professional - people would be contracting with him, not his company, surely? I think having a company works from a merchandising perspective and maybe for image rights etc. but probably not just for competition earnings.

However, the best advice I can give is to have him speak to an accountant that is a specialist in the taxation of sports people so that he's in the best possible position from the word go.

The company sponsor should be able to claim relief, again, assuming the expense is wholly and exclusively for the purposes of its trade.

I agree with the self employed bit. However considering that he is currently in full time employment (his regular day job), can he still claim self employment for his pro golfing bit. He takes time off to play in comps.

Will also look up the PGA (or wud that be R&A) website

Interesting website.. Check FAQ http://www.advisers4golfers.co.uk/tour-professional-golf-accountant/

And another http://www.carpenterbox.com/golfprofessionals/

 

[davidy233]

I agree with the self employed bit. However considering that he is currently in full time employment (his regular day job), can he still claim self employment for his pro golfing bit. He takes time off to play in comps.

Will also look up the PGA (or wud that be R&A) website

I'd think he can - I have a full time (well four days a week) job which is salaried and am also a freelance sports photographer - Cheers for remeinding me I have to submit my tax online in the next couple of weeks