June 17th, 2016
1966 and all that
It's now half a century since England's World Cup victory resulted in their captain, Bobby Moore, having to defend the Revenue's attempt to tax the winner's bonus – equivalent to £1,000 per player.
Even if not judging by the standards of the mind-boggling sums paid to today's generation of top-flight footballers, this was still a modest sum from the FA following such a historic achievement, and the decision by Mr Justice Brightman to find in favour of the appellant in Moore v Griffiths 48 TC 338 was seen by many as a victory for common sense.
He said: 'I think it would be wrong to regard the payment to Mr Moore as being something in the nature of a reward or remuneration for services. The true purpose of the payment was to mark his participation in an exceptional event, namely the winning of the World Cup. In other words, the payment had the quality of a testimonial or accolade rather than the quality of remuneration for services rendered'.
It remains a leading case for gifts/awards that are not taxable (Tolley's Income Tax 2015/16 Ch. 27.55) and is considered in the forthcoming book, 'Plucking the Goose – a Century of Taxation from the Great War to the Digital Age', published in September to celebrate the centenary of Tolley, 1916 – 2016.
Not surprisingly perhaps, the proceeds of testimonials are no longer regarded with quite the same degree of benevolence, following the measure announced as part of Finance Act 2016 to make all sporting testimonials and benefit matches chargeable to tax from next April in a clampdown on the huge tax-free sums that could be earned from such events. It is subject to a £100,000 exemption aimed to help less well-off players carving out a more modest living in the lower leagues (Tolley's Income Tax 2016/17 (online) 27.74a).
Significantly the multi-millionaires representing England at this month's Euro 2016 Championships in France have no expectation to be paid; since 2007 they have collectively donated their match fees to charitable causes as part of the England Footballers Foundation, raising over £4 million in the process.