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Varnish finally sues BC/UK Sport

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Re: Re:

11 Nov 2017 20:22

yaco wrote:
thehog wrote:
fmk_RoI wrote:
yaco wrote:I dont know what I'm talking about YET in the initial court hearings to determine whether Varnish could take her case further ( BC's legals went for the jugular in asking for the full range of court costs if Varnish lost ) - So there was no backing down from BC's legal eagles - And as your last sentence states if Varnish passes the Employee Tribunal to start civil proceedings and loses she is up for costs - And BC's legal teams will be as pedantic as possible which leads to an increase in total costs.
With all due respect yaco, you really don't appear to have a clue here:
The Telegraph has learnt British Cycling also had the option of submitting costs and deposit order applications against Varnish but did not do so.


Exactly. It’s very likely, even if Varnish fails in her attempt for compensation that a judge will not issue a costs order against her. Any sensible claim a judge would not expect an individual to consume the costs of both sides, British Cycling are alone on this one and will likely settle before it gets to the stage of document discovery.


So in effect your thought's are similar to Wiggo's Package in that there will be a mutually agreed settlement - We'll have to wait and see what happens but I suppose the devil will be in the detail.


The very nature of civil procedure encourages and expects both parties to come to a settlement, court is only for those who ultimately cannot agree. Maximum payout from the court will only occur if there is evidence of attempts to settle. So it’s in Varnish’s counsels interest to at least speak with UK Sport and British Cycling. That is the law rather than anyone’s point of view.
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Re: Re:

14 Nov 2017 14:45

Varnish allowed back to race for organisation she's suing? Seems unlikely

http://www.cyclingweekly.com/news/latest-news/lawyers-will-green-light-jess-varnish-return-358618

More likely this is BC's tactical response to Varnish saying she's taking the litigation all the way on principle

BC hinting at a place back on the team if she plays nice...
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14 Nov 2017 15:05

As above, i expect her to get an out of court settlement and a spot back on the Olympic Program....it should be enough to buy her silence, her press release sounds very principled but she's still young (26) and a load of money and her career back will be very tempting.
Her profile is now higher than ever in the British media and i'd expect a return to cycling to come with lucrative endorsement deals for her...hard to turn that down at her age, buy a house, make herself financially secure and make use of her world class talent/body while she's still young enough.
Job done for BC.
deviant
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15 Nov 2017 12:34

Couple of things to add here. Firstly, not all staff members at BC (and certainly a large number outside the WCPP) or other sporting organisations earn more than the non-taxable grant that athletes receive. Of course, there are different levels of grant depending on your expected medal prospects, so some athletes are granted more than others. These athletes also do not have to pay for coaching, travel, medical/physio bills and in some cases smaller things like free phone contracts as these are all covered by the sports governing body mostly via funding from UK Sport and partly from income generated by the sporting body.

If Jess does go onto win this case, Olympic sport funding in the UK will likely cease to exist and it would also likely see the end of what we see now, whereby the athletes do not have to pay for the coaching and access to the training ground/velodrome/courts. This would reduce sport in the UK back to an amateur level similar to what was happening prior to the National Lottery as UK Sport would likely just decide to end funding except for travel costs to the Olympics at the detriment to the performance of the athletes. This would mean these athletes needing to self fund their sporting endeavours via work leaving less time for training and recovery which they do not have to do at this moment.

It could easily be said that the phrase cutting off your nose to spite your face would very much come to mind over this case.

Personally, I don't see athletes as employees in the UK. The State provides funding to allow the individual to perform at the best of their ability on a tax free basis, and then allows the individual to earn an income through prize money and other personal sponsorship deals which is then taxed on. It would be interesting to see how well the performances and therefore the sponsorship levels will hold out if all of what is received now is stopped.
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Re:

15 Nov 2017 14:40

Big_Blue_Dave wrote:Couple of things to add here. Firstly, not all staff members at BC (and certainly a large number outside the WCPP) or other sporting organisations earn more than the non-taxable grant that athletes receive. Of course, there are different levels of grant depending on your expected medal prospects, so some athletes are granted more than others. These athletes also do not have to pay for coaching, travel, medical/physio bills and in some cases smaller things like free phone contracts as these are all covered by the sports governing body mostly via funding from UK Sport and partly from income generated by the sporting body.

If Jess does go onto win this case, Olympic sport funding in the UK will likely cease to exist and it would also likely see the end of what we see now, whereby the athletes do not have to pay for the coaching and access to the training ground/velodrome/courts. This would reduce sport in the UK back to an amateur level similar to what was happening prior to the National Lottery as UK Sport would likely just decide to end funding except for travel costs to the Olympics at the detriment to the performance of the athletes. This would mean these athletes needing to self fund their sporting endeavours via work leaving less time for training and recovery which they do not have to do at this moment.

It could easily be said that the phrase cutting off your nose to spite your face would very much come to mind over this case.

Personally, I don't see athletes as employees in the UK. The State provides funding to allow the individual to perform at the best of their ability on a tax free basis, and then allows the individual to earn an income through prize money and other personal sponsorship deals which is then taxed on. It would be interesting to see how well the performances and therefore the sponsorship levels will hold out if all of what is received now is stopped.


If Team GB's athletes are deemed to be employees as a result of the Varnish case Olympic funding won't drop off a cliff - it will just have to be structured differently

The grant money that currently goes direct to the athletes, etc would have to go to the governing bodies instead who would then pay them salaries

An important consequence would be that income tax and national insurance would have to be paid on those salaries (roughly 20% on top) and the question would be how that additional cost is funded - more money from the Lottery/central government? Reduction in take home pay for athletes? Less athletes on the Olympic programme? IMO the last option is most likely to happen

But a 20% increase in salary costs is not such a big deal in the wider context of all the other areas where money is spent. And all those other costs (permanently employed governing body managers/coaches, equipment, travel, rent for premises, medical bills, etc) would be unchanged

UK Sport's Olympic funding model (not just the no employment rights for athletes thing but also the whole win medals or lose funding thing) has led to unethical practices and unsavoury behaviour becoming the norm in many Olympic sports - the scandals just keep coming

Time to clean house - and if Team GB wins a few less Olympic medals a a result then personally I would have no problem with that
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Re: Re:

26 Nov 2017 20:15

Wiggo's Package wrote:
Big_Blue_Dave wrote:Couple of things to add here. Firstly, not all staff members at BC (and certainly a large number outside the WCPP) or other sporting organisations earn more than the non-taxable grant that athletes receive. Of course, there are different levels of grant depending on your expected medal prospects, so some athletes are granted more than others. These athletes also do not have to pay for coaching, travel, medical/physio bills and in some cases smaller things like free phone contracts as these are all covered by the sports governing body mostly via funding from UK Sport and partly from income generated by the sporting body.

If Jess does go onto win this case, Olympic sport funding in the UK will likely cease to exist and it would also likely see the end of what we see now, whereby the athletes do not have to pay for the coaching and access to the training ground/velodrome/courts. This would reduce sport in the UK back to an amateur level similar to what was happening prior to the National Lottery as UK Sport would likely just decide to end funding except for travel costs to the Olympics at the detriment to the performance of the athletes. This would mean these athletes needing to self fund their sporting endeavours via work leaving less time for training and recovery which they do not have to do at this moment.

It could easily be said that the phrase cutting off your nose to spite your face would very much come to mind over this case.

Personally, I don't see athletes as employees in the UK. The State provides funding to allow the individual to perform at the best of their ability on a tax free basis, and then allows the individual to earn an income through prize money and other personal sponsorship deals which is then taxed on. It would be interesting to see how well the performances and therefore the sponsorship levels will hold out if all of what is received now is stopped.


If Team GB's athletes are deemed to be employees as a result of the Varnish case Olympic funding won't drop off a cliff - it will just have to be structured differently

The grant money that currently goes direct to the athletes, etc would have to go to the governing bodies instead who would then pay them salaries

An important consequence would be that income tax and national insurance would have to be paid on those salaries (roughly 20% on top) and the question would be how that additional cost is funded - more money from the Lottery/central government? Reduction in take home pay for athletes? Less athletes on the Olympic programme? IMO the last option is most likely to happen

But a 20% increase in salary costs is not such a big deal in the wider context of all the other areas where money is spent. And all those other costs (permanently employed governing body managers/coaches, equipment, travel, rent for premises, medical bills, etc) would be unchanged

UK Sport's Olympic funding model (not just the no employment rights for athletes thing but also the whole win medals or lose funding thing) has led to unethical practices and unsavoury behaviour becoming the norm in many Olympic sports - the scandals just keep coming

Time to clean house - and if Team GB wins a few less Olympic medals a a result then personally I would have no problem with that



You appear to have over simplified the cost, which would be significant. The people on the low level of grant would still have to pay NI, even if they just escape income tax. The majority would lose anything between approximately 30-50% of their grant income on NI and income tax, depending on whether they have additional income from other sources. (Not a tax expert so unsure whether any of the other benefits would also become taxable e.g. private medical cover). Unless the athletes are expected to accept this substantial hit, which would lead to some calling it a day, the increased cost to the Federations would be significant, particularly when added to the cost of providing pension contributions and paying employer NI.
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Re: Re:

26 Nov 2017 20:25

kev1n wrote:You appear to have over simplified the cost, which would be significant. The people on the low level of grant would still have to pay NI, even if they just escape income tax. The majority would lose anything between approximately 30-50% of their grant income on NI and income tax, depending on whether they have additional income from other sources.
You appear to be assuming that sports people do not currently pay tax. And you are ignoring that the greater problem is the additional cost put on UK Sport of employer's NI and pension contributions.
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Re: Re:

26 Nov 2017 20:34

fmk_RoI wrote:
kev1n wrote:You appear to have over simplified the cost, which would be significant. The people on the low level of grant would still have to pay NI, even if they just escape income tax. The majority would lose anything between approximately 30-50% of their grant income on NI and income tax, depending on whether they have additional income from other sources.
You appear to be assuming that sports people do not currently pay tax. And you are ignoring that the greater problem is the additional cost put on UK Sport of employer's NI and pension contributions.


We are not talking about sports people. We are talking about specific people who currently receive a grant as part of the Olympic program, which is not included as income and therefore not included in their NI or income tax calculation. If they become employees it all becomes subject to NI and income tax.
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Re: Re:

26 Nov 2017 21:43

kev1n wrote:
fmk_RoI wrote:
kev1n wrote:You appear to have over simplified the cost, which would be significant. The people on the low level of grant would still have to pay NI, even if they just escape income tax. The majority would lose anything between approximately 30-50% of their grant income on NI and income tax, depending on whether they have additional income from other sources.
You appear to be assuming that sports people do not currently pay tax. And you are ignoring that the greater problem is the additional cost put on UK Sport of employer's NI and pension contributions.


We are not talking about sports people. We are talking about specific people who currently receive a grant as part of the Olympic program, which is not included as income and therefore not included in their NI or income tax calculation. If they become employees it all becomes subject to NI and income tax.


You are indeed correct. However, it’s a huge leap that UK Sport are making stating that if a court or tribunal finds in Varnish’s flavor that would set precedence and class all those who receive grants as taxable employees. My sense it’s scare mongering, most certainly if that case is heard in employment tribunal, no precedence will be set regardless of the result.
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Re: Re:

26 Nov 2017 22:14

kev1n wrote:We are talking about specific people who currently receive a grant as part of the Olympic program, which is not included as income
It is not counted as taxable income for some. For others it very much is. Whether those for whom it is not considered taxable would likely gain employment status should Varnish succeed is highly doubtful.
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Re: Re:

26 Nov 2017 22:42

fmk_RoI wrote:
kev1n wrote:We are talking about specific people who currently receive a grant as part of the Olympic program, which is not included as income
It is not counted as taxable income for some. For others it very much is. Whether those for whom it is not considered taxable would likely gain employment status should Varnish succeed is highly doubtful.


Hmmmm no. Tax law clearly defines what is a grant via the government or lottery funding. It doesn’t distinguish between one person to another. It most certainly does draw a line at what is classed as income and thus taxable. The law is actually very simplified to this respect. That’s what it’s a huge leap for UK Sport to suggest that it would class all athletes as employees and thus any income becomes taxable. Tax law doesn’t care whether they are an employee or not, it only is concerned at the source and type of income it is.
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Re: Re:

27 Nov 2017 14:32

thehog wrote:Hmmmm no. Tax law clearly defines what is a grant via the government or lottery funding. It doesn’t distinguish between one person to another.
RTFM, please. Some Lottery funding is taxable.

TL:DR - Mary receives Lottery funding of £22,000. She has other sponsorship income. She has achieved success and engaged an agent. She is liable for tax on all her income, Lottery funding included.
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Re: Re:

27 Nov 2017 14:53

fmk_RoI wrote:
thehog wrote:Hmmmm no. Tax law clearly defines what is a grant via the government or lottery funding. It doesn’t distinguish between one person to another.
RTFM, please. Some Lottery funding is taxable.

TL:DR - Mary receives Lottery funding of £22,000. She has other sponsorship income. She has achieved success and engaged an agent. She is liable for tax on all her income, Lottery funding included.


Again, no. Your quick internet search has failed you in your inabilty to read correctly.

In the example given the Lottery funded award is not taxable. The code is clear as I stated, the source and type of income will determine if it’s a taxable item or not.

She is in receipt of an Athlete Personal Award (APA) of £22,000 and sponsorship income of £7,000. This total funding of £29,000 is however insufficient to meet her training and subsistence expenses which include the costs of the flat. Even though Mary is still only exercising a hobby and not yet trading it is worth noting that if the sponsorship income is received in return for services rendered, and this could simply be an endorsement of certain products, then the £7,000 would be taxable as miscellaneous income under Part 5 Chap 8 ITTOIA 2005. The APA is not taxable as Mary is not carrying on a trade, see BIM50675.


When she moves from Sport as hobby to a trade she has to declare all her income including the APA but receives a deduction.
Last edited by thehog on 27 Nov 2017 14:56, edited 1 time in total.
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Re: Re:

27 Nov 2017 14:56

thehog wrote:
fmk_RoI wrote:
thehog wrote:Hmmmm no. Tax law clearly defines what is a grant via the government or lottery funding. It doesn’t distinguish between one person to another.
RTFM, please. Some Lottery funding is taxable.

TL:DR - Mary receives Lottery funding of £22,000. She has other sponsorship income. She has achieved success and engaged an agent. She is liable for tax on all her income, Lottery funding included.


Again, no. Your quick internet search has failed you in your inabilty to read correctly.

In the example given the Lottery funded award is not taxable. The code is clear as I stated, the source and type of income will determine if it’s a taxable item or not.

She is in receipt of an Athlete Personal Award (APA) of £22,000 and sponsorship income of £7,000. This total funding of £29,000 is however insufficient to meet her training and subsistence expenses which include the costs of the flat. Even though Mary is still only exercising a hobby and not yet trading it is worth noting that if the sponsorship income is received in return for services rendered, and this could simply be an endorsement of certain products, then the £7,000 would be taxable as miscellaneous income under Part 5 Chap 8 ITTOIA 2005. The APA is not taxable as Mary is not carrying on a trade, see BIM50675.
FFS Hog, read the **** page.
Mary wins gold at the World Championships and engages an agent to help her exploit her recent success. She is able to secure more sponsorship income and promotional work for a national company.

Mary’s sports activities are no longer a hobby for tax purposes. She is now organised in a business-like manner and conducts her sports activities with a view to profit. She is now taxable as she is carrying on a trade.

Mary’s trading income includes:

* APA,
* sponsorship/endorsement fees,
* winnings,
* appearance fees etc from competitions and events,
* ncome from associated activities undertaken by her (e.g. TV appearances), and
* the value of goods or equipment supplied to her.
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Re: Re:

27 Nov 2017 14:57

fmk_RoI wrote:
thehog wrote:
fmk_RoI wrote:
thehog wrote:Hmmmm no. Tax law clearly defines what is a grant via the government or lottery funding. It doesn’t distinguish between one person to another.
RTFM, please. Some Lottery funding is taxable.

TL:DR - Mary receives Lottery funding of £22,000. She has other sponsorship income. She has achieved success and engaged an agent. She is liable for tax on all her income, Lottery funding included.


Again, no. Your quick internet search has failed you in your inabilty to read correctly.

In the example given the Lottery funded award is not taxable. The code is clear as I stated, the source and type of income will determine if it’s a taxable item or not.

She is in receipt of an Athlete Personal Award (APA) of £22,000 and sponsorship income of £7,000. This total funding of £29,000 is however insufficient to meet her training and subsistence expenses which include the costs of the flat. Even though Mary is still only exercising a hobby and not yet trading it is worth noting that if the sponsorship income is received in return for services rendered, and this could simply be an endorsement of certain products, then the £7,000 would be taxable as miscellaneous income under Part 5 Chap 8 ITTOIA 2005. The APA is not taxable as Mary is not carrying on a trade, see BIM50675.
FFS Hog, read the **** page.
Mary wins gold at the World Championships and engages an agent to help her exploit her recent success. She is able to secure more sponsorship income and promotional work for a national company.

Mary’s sports activities are no longer a hobby for tax purposes. She is now organised in a business-like manner and conducts her sports activities with a view to profit. She is now taxable as she is carrying on a trade.

Mary’s trading income includes:

* APA,
* sponsorship/endorsement fees,
* winnings,
* appearance fees etc from competitions and events,
* ncome from associated activities undertaken by her (e.g. TV appearances), and
* the value of goods or equipment supplied to her.


Correct but it’s not taxed, it’s mearly declared. Simple.
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Re: Varnish finally sues BC/UK Sport

27 Nov 2017 14:59

And of course back to my original point; it doesn’t class her as an employee.
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Re: Re:

27 Nov 2017 15:01

thehog wrote:Correct but it’s not taxed, it’s mearly declared. Simple.
ROTFLMFAO
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Re: Varnish finally sues BC/UK Sport

27 Nov 2017 15:03

thehog wrote:And of course back to my original point; it doesn’t class her as an employee.
And I never said that receipt of a grant would guarantee employment status. Read what I wrote Hoggy: I very specifically said the opposite.

(You, however, did say, very clearly, that tax law "doesn’t distinguish between one person to another." The case studies provided by HMRC clearly demonstrate that you are talking through your ****.)
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Re: Varnish finally sues BC/UK Sport

27 Nov 2017 15:25

fmk_RoI wrote:
thehog wrote:And of course back to my original point; it doesn’t class her as an employee.
And I never said that receipt of a grant would guarantee employment status. Read what I wrote Hoggy: I very specifically said the opposite.

(You, however, did say, very clearly, that tax law "doesn’t distinguish between one person to another." The case studies provided by HMRC clearly demonstrate that you are talking through your ****.)


Again to my original point, whether Varnish wins or loses her claim, it won’t redefine all athletes as employees. That is scare mongering by UK Sport. Very simple, not sure why you’re trying to confuse the issue.
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Re: Varnish finally sues BC/UK Sport

27 Nov 2017 15:30

thehog wrote:Again to my original point, whether Varnish wins or loses her claim, it won’t redefine all athletes as employees. That is scare mongering by UK Sport. Very simple, not sure why you’re trying to confuse the issue.
Ah, right, yes, your confusion is my fault. Got it.
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