sharma Posted April 26, 2011 Posted April 26, 2011 ive been wanting to ask a few questions regarding these ipl contracts for a while, heres the list: (let us use mahela jayawardena as an example) 1) he is contracted at 1.5m, is that per season? or 3 years? 2) does he get money as per his availability? like if he was only available for 5 games in 2011, would he still be getting his full 1.5m (or 1.5/3)? whats the maths behind it 3) is this money taxable in india? 4) is it taxable in sl? 5) 10% goes to slcb, so he gets paid 90% of 1.5m? or is that 10% on top of the 1.5 he is being paid 6) does he get paid extra for the endorsements that he does through his franchise? like the ads they make him do (or like the ones zak or steyn do for their franchises and its sponsor products like kingfisher etc) or is it free because he is contracted by the franchise 7) is the prize money he wins as MOM taxable in india or sl? 8) if kochi qualify for CL and he plays for them, then is he paid extra or is that included in the contract anyway the final question is regarding players like dhoni and sachin who were retained and not auctioned: 9) do we know how much the franchise pays them? we know that they blocked 1.5m in the auction, but surely they are being paid more than that.
Zap_Brannigan Posted April 26, 2011 Posted April 26, 2011 ive been wanting to ask a few questions regarding these ipl contracts for a while, heres the list: (let us use mahela jayawardena as an example) 1) he is contracted at 1.5m, is that per season? or 3 years? 2) does he get money as per his availability? like if he was only available for 5 games in 2011, would he still be getting his full 1.5m (or 1.5/3)? whats the maths behind it 3) is this money taxable in india? 4) is it taxable in sl? 5) 10% goes to slcb, so he gets paid 90% of 1.5m? or is that 10% on top of the 1.5 he is being paid 6) does he get paid extra for the endorsements that he does through his franchise? like the ads they make him do (or like the ones zak or steyn do for their franchises and its sponsor products like kingfisher etc) or is it free because he is contracted by the franchise 7) is the prize money he wins as MOM taxable in india or sl? 8) if kochi qualify for CL and he plays for them, then is he paid extra or is that included in the contract anyway the final question is regarding players like dhoni and sachin who were retained and not auctioned: 9) do we know how much the franchise pays them? we know that they blocked 1.5m in the auction, but surely they are being paid more than that. 1) he is contracted at 1.5m, is that per season? or 3 years? Per Season 2) does he get money as per his availability? like if he was only available for 5 games in 2011, would he still be getting his full 1.5m (or 1.5/3)? whats the maths behind it Its pro-rata up to a point i.e. he is paid per game but if he is available for more than some percentage of games, he gets the full amount. The rules changed this time so i am not sure about what that point is. 3) is this money taxable in india? He is getting an Indian salary so probably. 4) is it taxable in sl? Shouldnt be but then again SL works in mysterious ways. 5) 10% goes to slcb, so he gets paid 90% of 1.5m? or is that 10% on top of the 1.5 he is being paid 10% of his earnings goes to SL. That is probably his post tax earnings. 6) does he get paid extra for the endorsements that he does through his franchise? like the ads they make him do (or like the ones zak or steyn do for their franchises and its sponsor products like kingfisher etc) or is it free because he is contracted by the franchise. No.Advertisers pay the team and can only do team based advertisement. If they want to use only jaya, then its between the player and the advertisers. 7) is the prize money he wins as MOM taxable in india or sl? Again, he gets paid in India, he pays tax in India. 8) if kochi qualify for CL and he plays for them, then is he paid extra or is that included in the contract anyway Actually, from this year, a player has a champions league clause in his contract i.e. a player only earns around 80% of his auction rate if his team doesnt qualify. But there could be additional player fees given for playing champions league, although this information is not out there. the final question is regarding players like dhoni and sachin who were retained and not auctioned: 9) do we know how much the franchise pays them? we know that they blocked 1.5m in the auction, but surely they are being paid more than that. No, we dont. My personal guess is around 2~4 million $.
Misu243 Posted April 27, 2011 Posted April 27, 2011 1) he is contracted at 1.5m, is that per season? or 3 years? Per Season 2) does he get money as per his availability? like if he was only available for 5 games in 2011, would he still be getting his full 1.5m (or 1.5/3)? whats the maths behind it Its pro-rata up to a point i.e. he is paid per game but if he is available for more than some percentage of games, he gets the full amount. The rules changed this time so i am not sure about what that point is. 3) is this money taxable in india? He is getting an Indian salary so probably. 4) is it taxable in sl? Shouldnt be but then again SL works in mysterious ways. 5) 10% goes to slcb, so he gets paid 90% of 1.5m? or is that 10% on top of the 1.5 he is being paid 10% of his earnings goes to SL. That is probably his post tax earnings. 6) does he get paid extra for the endorsements that he does through his franchise? like the ads they make him do (or like the ones zak or steyn do for their franchises and its sponsor products like kingfisher etc) or is it free because he is contracted by the franchise. No.Advertisers pay the team and can only do team based advertisement. If they want to use only jaya, then its between the player and the advertisers. 7) is the prize money he wins as MOM taxable in india or sl? Again, he gets paid in India, he pays tax in India. 8) if kochi qualify for CL and he plays for them, then is he paid extra or is that included in the contract anyway Actually, from this year, a player has a champions league clause in his contract i.e. a player only earns around 80% of his auction rate if his team doesnt qualify. But there could be additional player fees given for playing champions league, although this information is not out there. the final question is regarding players like dhoni and sachin who were retained and not auctioned: 9) do we know how much the franchise pays them? we know that they blocked 1.5m in the auction, but surely they are being paid more than that. No, we dont. My personal guess is around 2~4 million $. Thanks...that clears up some of these burning questions. I'd love to take a look at BCCI's balance sheet and income statements though...
sreej Posted April 27, 2011 Posted April 27, 2011 Hey Zap..just wondering..where did you get the information regarding the Champions League clause from? source?
Zap_Brannigan Posted April 27, 2011 Posted April 27, 2011 Hey Zap..just wondering..where did you get the information regarding the Champions League clause from? source? I've been following cricket news regularly. Just one of the things that comes up but i cant remember when or where. It is a fairly new addition so should be sometime in the last few months.
ganeshran Posted April 27, 2011 Posted April 27, 2011 10% of the SL players earnings is paid by BCCI to SL board as royalty. It is not taken from the players salary
sharma Posted April 27, 2011 Author Posted April 27, 2011 nice work ZB, i hope the taxes are high for them :P lol
Ramzz Posted April 27, 2011 Posted April 27, 2011 Foreign players are paid in US dollars and hence not talked. This is what was said during the auction
Mariyam Posted April 27, 2011 Posted April 27, 2011 @ Sharma, The tax related questions you ask are very complicated and the answer varies by country. The government rules would classify Jayawardene as a resident but not ordinarily a resident (RNOR) as per the tax norms. Sri Lanka is a country with which India has an agreement for avoidance of double taxation. So there is no question of him paying tax twice. Furthermore, our agreements with SL gives the player the option whether to pay tax in India or in SL. So it is Jayawardene's call, if at all he has to pay any tax. Tax is computed on his total earnings and hence his MoM, Karbon Kamal catch, Billu Barber bowling etc all are counted as taxable income. With some nations, we have an agreement that any foreign national who works in a government company or a company that acts under the vestiges of government control ( IPL : BCCI relation in this case) or a foreign company for a period of less than 90 days in a fiscal year is exempt from paying tax. That is how I think most of the IPL foreigners will be treated. Its been a while since I read up on taxation of foreigners in India. Will look up more on this after work. However, if they worked for say Reliance Industries ( a pvt ltd Indian company) for a period of 30 days, they would be paying tax in India. :P Funny laws, this land has.
Zap_Brannigan Posted April 27, 2011 Posted April 27, 2011 nice work ZB' date=' i hope the taxes are high for them :P lol[/quote'] Its already pretty low for most players. Lets say a foreign player is auctioned for 1 million $. Auction rate = 1, 000, 000 If failed to qualify for CL = - 200, 000 Cut to his board = - 80, 000 Income tax in India (Aprx. 30%) = - 216, 000 So in the end, a player gets only half or less of his auction price.
Zap_Brannigan Posted April 27, 2011 Posted April 27, 2011 So no Indian tax for the foreign players? Doesn't Sounds good.
Mariyam Posted April 27, 2011 Posted April 27, 2011 Its already pretty low for most players. Lets say a foreign player is auctioned for 1 million $. Auction rate = 1, 000, 000 If failed to qualify for CL = - 200, 000 Cut to his board = - 80, 000 Income tax in India (Aprx. 30%) = - 216, 000 So in the end, a player gets only half or less of his auction price. Hi Zap, I'm a little confused. Why are you deducting the "cut to his board" bit from the player's purse? The player doesn't have to pay the board. The IPL or maybe the Franchise for which the player plays for has to pay the board? Its a payment made for a contract within a contract. I forget the Latin term for it, but the idea of the Franchise paying for the cricketer is that they are signing a contract with a person who is already under contract with his national board or something like that. Will have to check up on this.
IKnowU Posted April 27, 2011 Posted April 27, 2011 Its players contract + additional fee to the board. Two separate fees payed by the franchise.
Mariyam Posted April 27, 2011 Posted April 27, 2011 So no Indian tax for the foreign players? Doesn't Sounds good. Not always the case. The Pakistani players weren't exempt from taxation in India. The GoI didn't exempt them because they don't exempt Indians from taxation (in similar cases) in Pakistan. Also, the players from West Indies ( Barbados, St. Lucia etc) do not have a double taxation treaty with India. So, while they may not be taxed here, they are definitely taxed there by the local government who will not leave a chance to milk these guys. But by and large, most of these guys do not have to pay taxes. It all depends on how the BCCI as an enterprise is defined as a company under tax norms. WIth the amount of tax the IPL (via BCCI) is paying the GoI, I don't think the govt is going to be unduly bothered about the 'change' they get from the players.
Zap_Brannigan Posted April 27, 2011 Posted April 27, 2011 Its players contract + additional fee to the board. Two separate fees payed by the franchise. and Mariyam, I am pretty sure that's not the case. The players board is similar to the player manager and gets a 10% cut from the players final earning (after deductions). I remember that the players weren't particularly happy about this but it keeps their boards off their back.
ganeshran Posted April 27, 2011 Posted April 27, 2011 Z_B no thats not the case. The 10% cut is not deducted from players earning. Also, Its paid by the BCCI , and not the franchisee
sharma Posted April 27, 2011 Author Posted April 27, 2011 i dont think ipl or bcci can be classified as a "govt entity" bcci is a private company isnt it, pcb is under the govt
Mariyam Posted April 27, 2011 Posted April 27, 2011 i dont think ipl or bcci can be classified as a "govt entity" bcci is a private company isnt it, pcb is under the govt Yes and no. The things is that as long as the BCCI's primary stated aim is " to spread cricket in India" it has a strong case for being a govt entity. The IPL changed all that. The BCCI changed its memorandum of association to organise the IPL.They aren't even granted tax relief now. The BCCI presides over and regualtes activities of state and regional boards ,which are government entities. For all practical purposes, BCCI as an entity is private ltd as per the contract laws. However, as per laws pertaining to taxation, IPL is not a tax entity*. Its BCCI who have to pay the taxes. And for what its worth, BCCI falls under the companies that are listed as " under the vestiges of govt control" and hence is treated as such. * Whether IPL is a tax entity or not is a very interesting case and the argument both for and against it were very convincing. However, that is a different topic altogether.
The Outsider Posted April 27, 2011 Posted April 27, 2011 5) 10% goes to slcb, so he gets paid 90% of 1.5m? or is that 10% on top of the 1.5 he is being paid 10% of his earnings goes to SL. That is probably his post tax earnings. The 10% goes from BCCI to the players' respective board. Nothing to do with the player or his franchise. 9) do we know how much the franchise pays them? we know that they blocked 1.5m in the auction, but surely they are being paid more than that. No, we dont. My personal guess is around 2~4 million $. That's true only for players who were retained outside the auction. For all other players they will get exactly the same amount they were bid for (at least legally, as there might be some underhand deals). PS : Good, informative posts there, Mariyam.
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