HMRC tells football agents to stop fiddling their tax returns

HMRC has written to hundreds of football agents warning of the discrepancies and falsehoods in their tax returns that are now being closely scrutinised.

The letter, seen by i and sent via the Football Association to around 1,900 of the governing body’s registered intermediaries operating in English football, makes clear that the tax authorities are clamping down on a series of malpractices.

The FA announced on Thursday that record sums — totalling £261m — are being paid to player representatives and HMRC say they are looking closely at dishonest under-reporting in regards to the amount agents are paid on deals, if onward payments from transfers are being used for tax evasion and what role the agent — if any — actually played in each player exchange.

‘Issues in relation to football and tax’

In the letter, HMRC assures the receiver that it is “not a compliance check into your tax affairs” but goes on to explain they have “found a number of issues in relation to football and tax” and lists examples they will be monitoring:

“We look into tax returns where amounts that are shown as work for clubs or for players looks to be unrealistic.
“We review information received to check if the work done by agents is being correctly described on invoices.
“We check if VAT has been correctly applied to all transactions.
“If a payment is made to an agent, we check who receives the money and for what commercial purpose they have received it.
“If we suspect that onward payments are made from fees received by an agent we will check all surrounding transactions to establish if there has been any potential facilitation of tax evasion.”

Liverpool top agent fees list

HMRC have already investigated payments involving 38 agents, 40 clubs and 172 players.

Premier League clubs paid fees totalling £211m to agents between 2017 and 2018 but that rose by a further £50m during the past year.

The FA’s latest figures from February 2018 to January 2019 indicate that Liverpool spent the most on agents’ fees, at £43.8million. Chelsea were second on the list, with £26.9m, followed by Manchester City (£24.1m) and Manchester United (£20.8m).

i can also revealed that the FA are tightening the net on agents breaching regulations around working with minors. In the past three years, 47 representatives have been suspended, fined or both for flouting FA rules involving minors but the number has steadily increased. In 2016, four agents were reprimanded, in 2017 it was 13, last year 20 and 10 have already been punished in 2019.