Professional sportspersons often engage managers to, amongst other things, negotiate fees and conditions with team owners. The Australian Tax Office does not believe that these fees are tax deductible.

On 23 November 2007, the Federal Court handed down decisions in Riddell v. Federal Commissioner of Taxation and Spriggs v. Federal Commissioner of Taxation.

These decisions held that management fees paid by two professional footballers to management companies for services performed in negotiating playing contracts were deductible under subsection 8-1(1) of the Income Tax Assessment Act 1997.

The Commissioner is appealing these cases in the Full Federal Court.

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