This summer could be a big one.
After all, restrictions are due to end (albeit later than we had initially hoped), the weather is expected to be great*, AND — perhaps most importantly — FOOTBALL’S DEFINITELY COMING HOME!*
*It may not.
So, with a summer football feast on the cards, we thought it would be a good idea to produce a football-themed payroll article.
This got us thinking. What if we chose to do an article on the amount of tax footballers pay...?
Many of us have heard about the exorbitant salaries of Premier League footballers; however, very few of us understand just how their salary is broken down, how much they actually take home and how much of it goes to the taxman.
Before we get started, we must mention that the salaries referenced throughout this piece are based on information that is widely available on the internet.
The purpose of this article is not to shame any of the parties mentioned. Instead, it’s merely done to highlight how much Premier League footballers may pay in both tax and National Insurance contributions (NICs).
The calculations in this article are based on the assumption that the parties mentioned are employees paid through PAYE and, as such, can only ever be considered an estimate.
How much tax do people pay?
To help understand how much tax a footballer would pay, it is helpful to first look at how UK-based employees are taxed.
The amount of tax someone pays will vary depending on how much they earn. This amount is also affected by the tax code belonging to an individual.
Tax codes indicate how much of a person’s salary is free of tax. The most common tax code in the UK is 1257L. Someone with this tax code would receive £12,579 for their Personal Allowance. This means that the first £12,579 they earn would be completely tax-free and, consequently, would only pay tax on money above this amount.
An employee earning the average UK salary, £31,461, and with the 1257L tax code, would have their salary broken down as shown in the table below.
Average UK salary broken down.
From the original £31,461 annual salary, £12,579 would be completely tax-free. This means that an employee would only pay tax on the remaining £18,882.00.
They would be taxed 20% of this, equalling £3,776.40. The NICs would be an additional £2,627.16, meaning that the employee would take home £25,057.44 in net pay during the year.
The 20% tax rate is also referred to as the basic tax rate and employees earning up to £50,270 a year are taxed at this rate. Money earned above this amount is taxed at 40% (higher rate). There is a third tax bracket, also referred to as the additional rate. Any earnings above £150,000 are taxed at 45%.
How much tax does a Premier League player pay?
According to the Global Sports Salary Survey, the pre-pandemic average salary for a footballer playing in England’s Premier League was a staggering £60,000 a week.
Did you know?
The average salary of a Premier League footballer pre-pandemic was £60,000 a week. This works out at over £3 million a year pre-tax.
The table below breaks down how much a footballer would pay in tax and NICs. We’ve also split the earnings into the different tax brackets to show how much of the salary is taxed at the varying rates.
Average Premier League footballer salary broken down.
A £60,000 weekly salary equates to just over £3.1 million annually. Anyone earning that amount of money would not be entitled to a Personal Allowance.
From the £3.12 million annual salary, £37,700 would be taxed at 20%, and £112,300 would be taxed at 40%.
The remaining £2.97 million would be taxed at 45%.
Altogether, someone earning this amount would pay £1,388,870 in tax and an additional £66,278.84 in NICs. This would leave them with a net salary of £1,664,761.16.
What about the super-rich players?
While a £60,000 weekly salary may be the average in the Premier League, some players — particularly the best ones — can be on an awful lot more.
The Premier League’s highest earner is Manchester City playmaker Kevin de Bruyne. He rakes home a staggering £385,000 a week and over £20 million a year pre-tax.
The highest-earning Englishman, Raheem Sterling, earns roughly around £300,000 per week and, pre-tax, £15.6 million per year.
England’s talisman and captain Harry Kane is said to be on about £200,000 a week. This gives him an annual salary of £10.4 million pre-tax.
To help understand Kane’s earnings, we’ve produced a table detailing how much he receives annually, monthly, weekly, and daily.
Harry Kane's salary broken down.
From Kane’s original £200,000 weekly earnings, he would take home £106,214.64. The remaining £93,785.36, including £4,074.60 NIC, would be taken by the taxman.
Over the course of the year, Kane’s £10.4 million annual salary would leave him with a take-home pay of slightly over £5.5 million. The amount of tax and NIC paid would be just under £4.9 million.
How Harry Kane's PayFit payslip would look.
What is PayFit?
PayFit is a cloud-based payroll and HR platform that helps businesses of all sizes manage and automate their payroll and HR processes.
We consider ourselves a hybrid software that combines the best of in-house — control and visibility — and outsourcing — expertise and specialism — in an all-in-one platform.