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HMRC internal manual

Business Income Manual

Athletes: Payments in kind

The tax treatment of non-cash payments (such as kit, goods or sporting equipment) received by the athlete depends on:

  • whether the individual is considered to be carrying on a trade or a hobby (see BIM50605), and
  • whether the non-cash payment was received as a gift or under a contract for work done.

If the non-cash payment is received purely as a gift and the athlete did nothing in return, the value of the non-cash payment is not taxable. See BIM50606, Example 2.If the athlete is not carrying on a trade and the non-cash payment was made under an enforceable contract in return for work done by the athlete, the value of the non-cash payment is taxable as miscellaneous income under Part 5 Chap 8 Income Tax (Trading and Other Income) Act 2005. See BIM50606, Example 2.

If the athlete is carrying on a trade, the value of the non-cash payment is taxed as trading income in the same way as a cash payment. See BIM50606, Example 3.

In terms of when these payments are recognised as income for tax purposes, see BIM50625.