Taxes befriend sports stars differently in every country

Bournemouth proved to be an excellent springboard for Kerkez Milos, who joined Liverpool in the summer of 2025 for a transfer fee of around £40 million, according to the British press, and received a contract until 2030. The club does not publish his salary, but according to Capology’s estimate, his basic salary for the 2025–26 season could be around £3.9 million per year without bonuses.

These salaries are not only astronomical for the average person, but they may even seem like a dream for top footballers playing for domestic club teams. The upper range of salaries for the highest-earning footballers playing in the Hungarian top league, the NB I, is estimated to be around 350 million forints gross per year, which is approximately one-third of Alex Tóth’s presumed salary in England.

However, it is worth looking deeper into the numbers to see to what extent the different tax systems of the two countries shade this significant difference – in which Dr. Balázs Horváth, member of the board of directors of SQN Trust Bizalmi Vagyonkezelő Zrt. and international tax expert, will help us.

According to Dr. Balázs Horváth, it is worth knowing that the Hungarian state also supports the competitiveness of domestic football through the tax system, as a result of which Hungary is a real “tax haven” for footballers. The law ensures that they pay tax under the simplified public burden contribution (EKHO) up to an annual income limit of 500 million forints, which means a total tax burden of 15%. In contrast, in England, footballers are required to pay taxes under exactly the same conditions as any other employee, and personal income taxation is based on a band system. The highest income bracket above £125,000 per year – which includes the vast majority of the income of footballers of Alex Tóth’s level – is taxed at a rate of 45%.

To illustrate with a specific example, out of the annual gross salary of 350 million forints of the highest-paid footballers playing in the NB I, nearly 300 million forints remain as after-tax income. In contrast, out of the annual gross salary of 1 billion forints of a footballer of Alex Tóth’s level playing in England, barely 540 million forints remain after tax and social security contributions are deducted. While the difference between gross salaries in Hungary and England is almost 3 times, the difference between net incomes is only 1.8 times – due to the difference in the taxation systems of the two countries. If we add to this the different housing and living costs, we can conclude that although Alex Tóth’s transfer to the English Premier League is a significant career advance in every respect, the sudden increase in his salary – due to the different taxation systems – is not as dramatic as it might seem at first glance.

Similar to England, in most European countries 40-50% of the gross salary of footballers is deducted in the form of personal income tax. In addition to Hungary, footballers can also enjoy significant tax breaks in Monaco and the Czech Republic – said Dr. Balázs Horváth.

It is also important to note that the OECD itself recommends treating the salaries and bonuses of athletes – often astronomical amounts – as a separate type of income. Accordingly, contrary to the general rule, not only the state of residence is entitled to tax such income, but also the source country, i.e. the state where the athlete actually carried out his income-generating activity.

This means that regardless of whether the given athlete – for example a Hungarian footballer – is tax resident in England, if he plays for a club there, he will be liable to pay tax in the United Kingdom on the income he earns there. The same principle applies if the athlete participates in a competition or tournament where there is a possibility of winning a prize.

A good example of this is the Australian Open, which ended on February 1st, and in its 121-year history, the highest prize money ever was awarded in 2026: the tournament winners – Elena Rybakina of Kazakhstan and Carlos Alcaraz of Spain – each received AUD 4,150,000, or nearly HUF 930 million, while the total prize money reached AUD 115,000,000. However, the joy of victory may have been significantly reduced by the fact that the withholding tax rate applied was 30–45%.