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Taxation of prizes for snooker players

Professional and semi-professional snooker players: what income is taxable, what expenses allowed?

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I've been chatting to a couple of snooker players: one is a member of the professional body and plays on the main circuit, the other is an amateur, who has been lucky enough to qualify to play in some professional events by virtue of his ranking as an amateur, and both have raised queries about taxation of prize money.

The pro is relatively straight forward, but what about winnings from entering a regular pro-am at his local club? It is a totally open competition which attracts a reasonable number of lower and mid-ranked pros. Prizes are funded mainly by entry fees and a small amount of sponsorship. The competition is organised by a couple of indiviuduals, and the club just agrees to act as host venue. Presumably the pro should declare these winnings as part of his business income.

As for the amateur player he has no income other than some minor prize money from amateur events (including the likes of the pro-ams mentioned above), and the couple of prizes from the professional events, along with some sposnorship. One of the prizes was earned at an overseas event and was subject to 20% withholding tax. He is obviosuly an aspiring pro, but are any of these earnings taxable? What about expenses, are any or all allowed?

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12th Dec 2017 00:14

"Professional" - yes, taxable I would say.

Amateur - probably (You say he has no other income, which suggests he is committed to this as a living vs a hobby. The sponsorship deal must also point the same way.)

Expenses - as per any self-employed person: travel and subsistence but not gallons of lager (if my memory of the Bill Werbeniuk tax case serves).

HMRC view assuming there is a read across from athletics to snooker:

https://www.gov.uk/hmrc-internal-manuals/business-income-manual/bim50605

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to Accountant A
11th Dec 2017 22:20

There is an interesting paragraph in the linked document:

"In one or two years an athlete’s earnings may have exceeded the expenses. And, perhaps, the whole of the athlete’s time may be devoted substantially to sporting and associated activities. However, even the presence of both those pointers is not decisive. You will need more information before deciding whether the athlete is organising the activities in a business-like manner and with a view to making a profit."

I think, with the best will in the world, an amateur is rarely going to be able to make a profit. The only way snooker players can do so is to secure a place on World Snooker's main tour as a member of the professional association and with an automatic right to take part in all the professional events. It's therefore arguable whether, at least in the short to medium term an amateur player could ever be playing with an expectation of making an overall profit.

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to Souwester
12th Dec 2017 00:15

Souwester wrote:

It's therefore arguable whether, at least in the short to medium term an amateur player could ever be playing with an expectation of making an overall profit.

Yes, there's obviously a grey area. Aside from travel, are there any significant costs?

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to Accountant A
12th Dec 2017 00:21

Travel, accommodation and subsistence are obviously the main expenses, and in previous seasons the entry fees to the pro events for which they qualified were reasonably chunky. Apart from that, little else of significance.

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12th Dec 2017 07:33

He may not make a profit but, as an aspiring professional, let us not ignore the possibility of losses, even if they are only available to carry forward.

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