As England gears up for the long awaited start of the Rugby World Cup 2015, an economic impact study has revealed that the world cup is set to net nearly £1billion for the UK economy.
The study, which was undertaken on behalf of the organising committee for Rugby World Cup 2015, England Rugby 2015, looked at the different ways in which a Rugby World Cup can benefit the host nation. It estimates that the tournament will generate a total output of around £2.2 billion, which is in line with a previous economic study undertaken in 2008. The report predicts that this will translate into a contribution of £982 million to national GDP.
The 2015 World Cup is also expected to attract more international visitors than any previous Rugby World Cup with more than 466,000 visitors anticipated to visit the UK over the six weeks of the tournament. Through spend on items including travel and accommodation, visitors are expected to contribute up to £869 million in direct expenditure to the UK economy.
It is not just the UK economy which is set to benefit, international rugby players will also benefit following a relaxation in the UK tax rules applied by HMRC earlier this year. In previous years overseas competitors were charged prorated tax on their global income (including endorsements) meaning that the more days they spent in the UK, and the more games they played, the more tax they owed. However, a new ruling which came into affect in spring 2015 means that taxes are now calculated instead on the number of UK events sportsmen participate in as a proportion of all appearances made per year worldwide. For the full story please see our earlier blog post.
Tax relief is also available for spectators. Households can boost their income by renting out accomodation to rugby fans, as part of the Government’s Rent-a-room scheme. The first £4,250 a householder earns is tax-free therefore sporting events like the Rugby World Cup offer a fantastic opportunity to make use of this relief, particularly if you reside near to a sports venue being used.
The tax relief can also apply if you run a guesthouse or bed and breakfast business in your home, although if you offer services such as meals and laundry and make an additional charge you must add this income to the rent to work out the total gross income (the total income before deducting expenses).
With the Rent-a-room tax relief set to increase to £7,500 in April 2016 this is definitely something to consider for future sporting events!