New queries, issue 4544

Global sportsman

Apportioning the tax on an international sportsman’s earnings and sponsorships.

Our client is a UK resident and domiciled professional sportsman with a growing reputation. In the past couple of years he has competed around the world and has won considerable sums. The prize money has suffered withholding tax between 0% and 30% which we have claimed against his UK marginal tax liability of 45%.

Our client now has the opportunity to compete regularly in the US although he will continue to be based in the UK. The US tournaments will form about one-third of all events. In 2015 he won prize money there a couple of times and suffered 30% federal withholding tax and local state taxes at differing rates. He also has a limited company which receives endorsement income and two of his sponsors are US-based companies. These have started to deduct...