Shouldn't this thread be titled 'What will the RFL do if any super league chairman breaks the salary cap?'?

No. Next.....

But why would that necessitate him opening his bank accounts the RFL?

Regardless, Sonny Bill Williams could open a company called SBW ltd based in BVI and is paid £3m a year by Marwan Koucash (dubai) Ltd for Sports consultancy fees. SBW doesnt draw down on that money until he leaves the UK. The tax man likely would never be aware, the RFL certainly wouldnt.

He would pay tax on his UK earnings i.e. his Salford Red Devils salary, which would be his salary cap value, say £200k. The other £3m would be a foreign company paying a foreign national for consultancy services, which HMRC would have no legal interest in.

No-one would be breaking the law in any way in the situation that I described, and the RFL would have no ability to keep track of it.

As long as the salary cap still applies to the normal running of the club, does it matter what offshore things happen as long as we get the best players in the world, who cares, as long as the club is not liable for any offshore activities.

I'd let him off, but only if he bought London Broncos too...

Good luck to Salford and the doc, I just wish the RFL could find another half a dozen like him.
Hopefully in a season or two, Salford v Wigan will be pulling in a 10,000+ crowd.

That's the issue really isn't it. The only way reds will be able to bankroll all this is to get a decent crowd at Barton. What's the current state of their season ticket sales, does anyone have an idea? If they can't generate interest with all the hoopla that's been going on in the off-season, then what hope for walk-up or away sales?

Sbw to anyone else has to be registered with the Red Devils before allowed to take the pitch, due to insurance reasons of the players. As soon as he is registered with Red Devils all payments to the player is seen by the rfl. Shell company's, dummy corporations and all the rest of it don't work. Apparently Leeds tried to sign all their players to Leeds tykes on dual code contracts and then paying half from each, but only counting the half from Leeds rhinos on the cap. They were forced to stop very quickly (again apparently) as the rfl saw all player payments as opposed to just what Leeds were paying.

Should the good Dr re-negotiate contracts with his suppliers, animal feed, vets services, livery, etc then those companies could "Sponsor" SBW or any other player.
A company owned by Dr Koukash cannot sponsor a player.
That's as I understand it.

It's still wide open to abuse.
Suppose I owned a company and as a Wigan supporter decided to give a couple of players cars with the company name on them. Then suppose IL decided to give me some work (not related to my sponsorship of course!!) at one of his companies. Unless I advertise in the programme or sponsor Wigan then as far as I'm aware nothing can be done. What if I own a few houses and let them out to players?

what if the player buys a horse for 50K and then charges The Docs stable 50k a time to service 10 mares in a year .... 500k........It has nothing to do with Rugby league so doesn't count against his salary as earnings derived from the game.

That wasn’t all the players, it was a few who Leeds wanted to play for both codes (mostly imports)with half counting towards the Salary Cap (or a designated portion for each) but were told that all would apply under the RL Salary Cap. I think the most obvious example of this would be Wendell Sailor who played 15 times for the Tykes and in two friendlies for the Rhinos who wanted to sign him for both clubs but his cap hit in RL would have been huge, so he went back to Brisbane. They were never actually allowed to do it.

Your shell companies etc are covered by the RFL’s regs and all payments are covered. However I can imagine the answer to the RFL demanding to see the books of Marwan Koucash Dubai (ltd) or the books of SBW (BVI) ltd being a fairly impolite no.

That payment doesnt go from Marwan Koucash or Salford Red Devils to Sonny Bill Williams. It goes from one private company that doesnt own an RL club, to another private company that the player may not declare ownership of.

The RFL could never prove, could never hope to prove, could never even really hope to know if offshore company A paid offshore company B any money. They wouldn’t really even need to be offshore. The RFL can see the books of the club, and probably the information of the player. They can’t hope to see the books of another company the owner of the club has, or hope to see the books of the company the player has.

Can you imagine the RFL asking Caddick construction for their payroll? Or to see their list of suppliers and their transactions with them?

This would then be heading into money laundering territory & tax fraud - all very murky & difficult to track down (& the RFL would never have a cat in hell's chance of working it out unless they suspected something was going on in the first place or a whistle-blower popped up).
Either way, bordering on illegal in so many areas.

It would be neither. It wouldn’t be close.

Company A can pay Company B whatever they want for whatever they want. If Company B for whatever reason decides later on to pay player A for ‘consultancy’ then that is fine and legal. If player A doesn’t declare his income at that point to the relevant authorities he would possibly have a problem. But offshore Company B is under no obligation to declare to the UK tax authorities it got a payment from Offshore Company A.

As long as Company A and Company B paid the relevant tax in their relevant jurisdictions, and player A declared his income to the correct tax Authorities when he got ‘paid’ by company B there would be no possibility of tax fraud, it isn’t money laundering in any way so that wouldn’t really be an issue.

There is actually nothing being held back from the tax authorities and no reason for the parties to hide what is going on from them. They arent actually avoiding any tax, it is being paid as it should in the jurisdictions it should

There is nothing in the Salary Cap rules which state that a player can’t earn money from third party companies just that those companies can’t be connected to the club. In this example company B has no connection to the club, it is simply a supplier to company A is connected to the club.

For the rfl to clear him to play he has to be registered either as an employee or a director as a company in the uk. That is because they then have to register in the uk for tax purposes. If they tried paying from Dubai to New Zealand then Salford could sign him for whatever they like, but he won't be registered to play. Once sbw ltd is registered in the uk the rfl can use tax returns to calculate income, and therefore use a "estimated income" to count on the cap. This can be seen by anyone on company's house. It's in the same way teams can't hire wives as very expensive cleaners

There are of course ways around the salary cap, but require offshore banking after initial payments and or financial instruments and you encounter bigger difficulties than the rfl then.

To suggest teams should go and find ways to deliberately go around circumvent the salary cap in such a manner is only going to create more problems

Nothing to stop one of the dr's offshore companies from paying money to SBW's mum and dad.....

I seem to remember the RFL making an example of Barrow Raiders chairman, Des Johnston, a couple of years ago for breaching salary cap rules and making payments "off the books" to players. [url=http://www.nwemail.co.uk/raiders/raiders-relegated-johnston-banned-from-rl-for-eight-years-1.885543?referrerPath=2.1779Johnston was banned from any involvment with the running of a Rugby League club for 8 years[/url. Surely if Koukash does the same, he'll be penalised in the same manner? Maybe he wont since he has money and Superleague is a different kettle of fish from Championship RL.

Its one thing for the RFL to censure somebody like Johnston and another thing entirely do take on an intelligent individual with more money than them. However, they do have a penchant for making bad decisions so I wont hold my breath should it come to this.

Koucash isnt paying him, He is paying a company he is an employee of, who in turn can pay him whenever they want (remembering ‘they’ is likely to be him)

He can be registered with a normal playing contract, and a decent wage. Koucash can then pay whatever he wants to Company B for ‘services’. Company B can then pay SBW whatever they want. SBW could wait until he had left the UK, and then have company B pay him his ‘Wage’ and he would never have to declare it to the UK authorities.

Many footballers already do it. Wayne Rooney does it, Michael Owen does it through a company called Owen Promotions, Theo Walcott does it through a company called TJW promotions.

There is no tax fraud, no need to not declare everything to the tax man, the correct tax can be paid, it isnt an attempt and there is no need to attempt to avoid tax.

The RFL would want to know what you declared for tax. Also anybody who is caught doing it like that has an 8 year ban as precedent has been set. Also from my previous comment its a lot harder to hide money from the tax man than people believe and its hard to keep a company books straight with yearly salaries being paid of the books.

Its not very complicated, is well established and already used by many sportsmen

You register a normal playing contract at a normal wage. This goes from club to player. So Koucash as Salford Red Devils pays SBW £200k a season to play for Salford

Company A based in Dubai pays Company B based in BVI a lump sum of £1m for consultancy services. This money sits in company Bs bank account. The UK tax authorities have no reason, no need and no jurisdiction to query this payment, it has absolutely nothing to do with them. It has even less to do with the RFL. Company A is a shell company owned by Koucash, and company B is a shell company owned by SBW, with his solicitor as trustee. All correct tax on this transaction has been paid in Dubai and BVI. This perfectly legal and above board.

Then, three years later SBW’s contract with Salford ends and he goes home to New Zealand. Whilst there Company B pays SBW a wage of £1m for Sports consultancy services. All correct tax is declared and paid in BVI and New Zealand. This is perfectly legal and above board. The UK tax authorities have no reason, no need, and no jurisdiction to query a payment from the BVI to NZ. The RFL have even less of one

There is no need for two sets of books, no need for hiding anything from the tax man, the RFL can know everything SBW earns and declares to the tax man. For three years he was under the RFL jurisdiction it would be £200k a year.

Well we don't need to worry about Bill Williams signing for Salford he's just agreed to go back to rugby Union for the 2015 season in a 2 year with Waikato Chiefs.

and it is a crying shame that british rugby league is not a realistic option for him.

would be that easy if you could just open a company up and bank account in dubai and never mind you are illegally avoiding tax as your residency would be in the uk. think the same thing happened with Harry Redknapp. Anything earning world wide is legible for tax if you live in the Uk.

His residency is irrelevant to the tax paid on the transaction between company A and company B. SBW’s residency only becomes important when he takes that money out of Company B, whilst ever it is in Company B its tax considerations are only relevant to the country in which company B is based.

SBW would be perfectly able to draw down that Wage from company B in the UK if he wished. He would at that point pay UK tax on his earnings. He still wouldn’t be in contravention the salary cap rules. It isn’t illegal or against the Salary Cap rules for SBW to earn money from a company other than the one which owns the club unless it is involved with the club in another way.

He could wait until he was back in New Zealand and at that point Company B could pay him the £1m and he would pay that tax to New Zealand.

Harry Redknapp BTW was cleared of all charges.