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2004 Mar 17 - Agassi hit with 27,520 UK tax bill

Andre Agassi is the first non-British based tennis player to be hit with a tax bill by the Inland Revenue. This ruling could seriously damage the representation of all tennis players (and sports stars) who intend to compete in UK sporting events.

High Court judge Justice Lightman ruled that Andre is required to pay the 27,520 tax bill dating back to 1998-99 which is based on sponsorship revenue he has received from clothing sponsor Nike and racket sponsor Head.

Andre argued that as he is not based in the UK and his sponsors have no tax liability in the UK then he should not be required to pay tax in the UK. But Justice Lightman sided with the Inland Revenue who claim that as Andre visits the UK every year to compete in British tennis tournaments at least some of the revenue he generates through sponsorship should be liable for taxation.

Justice Lightman stated:

"It is common ground that section 556 of the 1988 (Income and Corporation Taxes) Act subjects non-residents to tax, if the payment is made by an English company or a foreign one with a tax presence here.

"The question raised is whether they are intended to be excused from liability if, instead, they are paid by a foreign company with no tax presence here.

"In my judgment it would be absurd to attribute to the legislature the intention that liability could in any and all cases be avoided by channelling the payment through a foreign company with no tax presence here.

"If this were the case, the tax would effectively become voluntary.

"As it seems to me, the plain and obvious intention of the legislature was to impose an obligation on the person making the payment irrespective of his tax presence here."


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