Why this matters

Image rights agreements can cover the commercial use of a person’s name, likeness and reputation, separately from their employment contract. The announced change focuses on payments related to employment, rather than every payment for commercial use of an individual’s identity.

Taxation as wages means affected arrangements should be reviewed for PAYE and National Insurance implications. At current rates, clubs could face an additional 15% employer NIC cost, while higher earners could face 2% employee NICs alongside income tax. This could increase contractual and cashflow pressures, particularly where net payments are guaranteed. April 2028 rates and treatment remain subject to confirmation. Routing payments through an image rights company should not be assumed to put them outside the measure.

Genuinely independent endorsements and commercial ventures need separate analysis. The Budget does not establish a definitive test for distinguishing these from employment-related payments.

How you should be preparing now

Use the extended timetable to assess exposure, rather than defer action until April 2028:

• Identify image rights payments potentially connected to employment, including payments made to companies
• Review contracts extending beyond 6 April 2028 and identify potential renegotiation points
• Model potential tax, National Insurance and cashflow effects for individuals and employers
• Document the commercial substance of independent arrangements and monitor legislation and guidance

Avoid assuming existing contracts will be protected: the budget provides no assurance of grandfathering or transitional relief.

For clubs, the extra preparation time is an opportunity to align commercial agreements, payroll processes and budgets before the new commencement date arrives.