This struck me to. Although, I think if there are going to be repercussions it's going to be league wide as I don't think MK is probably doing anything different than most Clubs.

Will be interesting to find out what happens, although I have a sneaky suspicion that not a lot will come of it for these very reasons.

Pheww.

I was worried our resident legal eagles would stay silent on this.

The one fact that is actually fact is that it's factually a fact that people don't know all the facts.

It sounds that the salary cap rules needs ripping up and starting again if things are so wide spread bypassed.

No. Mediation is always going to be the RFLs preferred strategy, where possible. As I said, it's a case lawyers would love to take on, because it can be dragged out for years. Even when defending technically correct clauses and conditions, nobody would emerge the victor from that court case.

There have been many challenges to the cap over the years, that have gone reported and unreported. Wigan were given a 3 year grace period when the cap was brought in to avoid the courts. There's always a compromise to be found, whether that's marquee rules, the introduction of financial sustainability rules or a host of other tack ons and flexibility agreements.

I think there will be plenty of owners squirming more than Derek about this.

If anything, Beaumont was honest and open about the salary cap at the end of the season

Yes, but the compromises are usually agreed in advance (and agreed by the other SL clubs).
A player having a hidden contract with a MK-owned company paying 40k a year is a breach of the salary cap. If it isn't, we might as well scrap the salary cap.
Still, we will have to wait and see.

I assume you mean open and honest about Leigh breaking the salary cap rules?!

I may of missed the point here, what cap rule hasn't been agreed by the majority of the clubs?

And, IF the second contract is properly reported to the RFL, and IF the figures reported are in line with the cap calculations, then there is no breach. The key word in all of this is hidden.

Working as a consultant I know the benefits of having holding companies etc to work around, and the deal structure may of been just to benefit the player. From an individual tax perspective, it's almost definitely better to have 2 contracts for 80k and 50k then it is 1 as an employee for 130k. It wouldn't surprise me in the least if lots of teams have multi contract structures to minimise tax (and as a result, maximise player pay per cap space) - its easy for the clubs to report, and it's easy for the RFL to investigate. It's when someone hides that (and then subsequently doesn't pay so it all get exposed in court ... Allegedly) that it all goes south.

Just out of curiosity, Magic Superbeetle, how does it benefit the player to have 2 contracts rather than 1?

Derek kicked up a stink because we were expected to compete directly with clubs that had almost double the spending power that we were allowed in order to achieve promotion. We obviously were not good enough last year and yet we were not allowed to spend any extra money to improve our team. If Derek had wanted to break the cap we would have signed Chase back in October when he 1st agreed terms. There is a reason that the saga dragged on and on for months. We eventually got the increase we wanted from the RFL (still not equal to SL but an extra £300k) so we could sign Rangi. We have also significantly downsized our squad from 30 to 25 to reduce costs.

Leigh are fine with regards to the salary cap. Most of our squad were part time players 18 months ago so aren't on big wages and I understand we have room for at least 1 more quality signing should the need or opportunity arise.

There is no personal tax benefit of doing this. Literally none.

I do confess to making the assumption that this isnt 2 contracts of employment for TP, rather a contract of employment and an invoice for the engagement of "TP consultancies inc." - which is where the benefits would lie.

Can the RFL/SL authorities stop a player from having a 2nd income? Might be an obvious way of circumventing the salary cap but surely if a player earns money for something away from the game (regardless of his employer) then that is his business?

Depends who the 2nd employers were. Any common directors/ owners/ managers between the 2 companies would see the second income needing to be declared on the cap.

There's nothing to stop, in theory, a player being employed as a player with 1 club, and then working as a coach/ consultant with another club.

Quote ="Michigan red"Can the RFL/SL authorities stop a player from having a 2nd income? Might be an obvious way of circumventing the salary cap but surely if a player earns money for something away from the game (regardless of his employer) then that is his business?'" A few years ago several clubs were paying players a second income in the form of image rights. From memory it was swept under the carpet. This reduced the amount of tax a player paid before the clampdown. (See below) This gave some clubs an advantage of paying a player less because the player was paying less tax. www.accountancyage.com/aa/news/1 ... layers-pay

Quote ="Michigan red"Can the RFL/SL authorities stop a player from having a 2nd income? Might be an obvious way of circumventing the salary cap but surely if a player earns money for something away from the game (regardless of his employer) then that is his business?'" A few years ago several clubs were paying players a second income in the form of image rights. From memory it was swept under the carpet. This reduced the amount of tax a player paid before the clampdown. (See below) This gave some clubs an advantage of paying a player less because the player was paying less tax. www.accountancyage.com/aa/news/1 ... layers-pay

Beaumont said he could use the same loopholes as other clubs, but would rather push for changes to the system, which he successfully did.

The Doc, on the other hand, said he was going to break the cap like other clubs and then did it!

Whether Leigh have reduced the playing squad by a few players or not, the majority of the squad is full time and even with the rise this year (up to 50% ~ 1.3 mil I think).
With the addition of Patterson, Chase, Hansen, Maitua, Weston, Tonga plus Fui, Hock, Higham and Brierly I find it very hard to believe they will be under the cap without being "creative" in some form or another.

Rumour is they all took huge pay cuts for the love, a bowl of lobby and a 10% discounted sundeck.

Dirk, you could always ask Derek if you are so concerned. FYI seeing as you are ill informed of the new SC rules, the SC limit in the championship is now exactly the same as the SL salary cap limit. The 50% of relevant income applies if that figure is less than the maximum SC limit. In Leighs case this as been adjudged/set by the RFL at 1.31M. Also if I recall, I saw somewhere that Bradfords is somewhere around 1.34M.

Now the last turnover figures I saw for Salford were published at 2.3M, dependant on what 'relevant' income includes that would see Salfords SC this season set lower than both Leigh and Bradford. As a rider to this I do not know if this was in Salfords 2014 accounts or 2015 accounts.

It's highly unlikely considering the club get 1.82m from Sky. Our main shirt sponsorship was quoted as 200K so that would leave just under 300K for gate receipts, corporate hospitality, all other sponsorships and merchandising sales.

CoE or invoiced, it doesn't alter the fact that the company who Puletua had the second contract with is actually registered as a dormant company at CH and has declared that it made no financial transactions during the year in question. So if that company is dormant then who did actually pay Puletua ? It's all very murky.

A set of abbreviated accounts were filed in Companies House a few days ago. Not had a proper look myself.

misinformed not sure where you get that from, you've just restated what is already originally posted with regards to spending limit.

Next time I see Derek I'll ask him

What's to stop a company owned by Mrs K , or one of his brothers paying TP £48000 a year to wash her cars. As long as he declares it for tax. It would have no connection to Salford? If Salford are found guilty and docked points, arent the players concerned also guilty of trying to get round the cap , and therefore shouldn't they get a ban as well?

Reporting is squarely in the domain of the club and therefore no player will be banned if their club breaches SC rules.

The rules regarding whose payments count:



Even if you successfully argue that Mrs. K doesnt fall under c), e) will forever defeat any attempt to devise a scenario. Same with wags working in the club shop.