13. TAX AND THE TENNIS PLAYER!

As I have mentioned in an earlier blog, (‘The Other Side of the Coin’), tennis players just starting out on the tour do not make money. In fact, they consistently make a loss. Now more often than not that means your player won’t have to pay much, if any, UK tax until she is actually making more from prize money and sponsorship/endorsements etc. than the income tax allowance. However, that’s not to say she won’t pay tax elsewhere in the world! Yes, you’ve got it, depending upon where your player competes will determine whether or not tax gets taken off her prize money before she receives anything. Some countries do not take any tax at all but others, for example, France, Germany, Sweden, the USA, Switzerland, Italy etc certainly do, and in some instances, this can be as high as 30% which is tough if your player hasn’t ‘made’ much money in the first place! 

Another sting in the tale is exchange rates. At some tournaments the prize money is paid out via bank transfer and is invariably sent in local currency. Typically, this means that when your player eventually receives her money, a bank charge has been deducted for the currency exchange, so she gets hit again. Now one way to alleviate this a little is to open multiple accounts and get paid into the one that is most relevant at the time. So, for example, my player has a Sterling account but she also has a Euro account and a US dollar account and chooses which one to use depending upon the country she is in. 

No one tells you this when you start on the tour and more often than not, your player will work it out as she goes along. But hopefully if you are reading this blog, you will be one step ahead and can get the foreign currency accounts up and running early on in your player’s career. 

In some countries, the tournament organiser will issue the player with a cheque and expect the player to go and cash this in a local bank. All well and good if she has the time and can find a bank, but sometimes the time between finishing a tournament and moving onto the next is very short, or is on a weekend when the banks are closed, so a cheque is not really convenient. In this instance, my advice is to ask nicely for cash or a bank transfer. More often than not, the organisers don’t realise that the players need the money they have just earned to pay the hotel bill so cash is preferred but maybe not if you have just won a big tournament and a large envelop would be required! Hasn’t happened in this household yet but maybe one day!

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