Mohamed Salah provides £37m reveal amid Liverpool contract talks

Mohamed Salah's UK-based company has published its accounts for the 2023/24 financial year

The future of Mohamed Salah at Liverpool remains unresolved. The Egyptian star reaches the end of his current deal at Anfield this summer.

Salah, 32, is Liverpool’s highest earner, with his output for the club ranking him alongside the all-time greats. There is a hope that he will continue his Reds journey beyond the end of this season but, rightly, he will want to be paid for his stature and what he brings to the table.

When it comes to what Salah earns per week there is no definitive number, but reports put it in the region of £350,000 per week, while his agent, Ramy Abbas Issa, previously stated during a Harvard Business School study on Salah’s last Liverpool deal, that his total income, including both wages, image rights and investment deals, has him earning around £1million per week.

“We conservatively expect the total amount received by Mohamed and the image rights companies over the next few years from both his playing contract and his image rights contracts to be somewhere between €54 million (£46.8m) and €62m (£53.7m) per year,” commented Abbas in the 2023 study.

“Now, Mohamed’s endorsements are (each) in the €4m (£3.5m) to €7m (£6.1m) range – him joining Liverpool was a game-changer.”

A new deal for Salah, especially given his stellar season this campaign, likely won’t see a reduction in his annual salary, and his own personal endorsements and investments are also bringing in the big bucks, as evidenced by the filing of his company’s accounts with Companies House this week.

The company, Salah UK Commercial Limited, had £29.3million in shareholder funds, up from £25.2million in 2023. In terms of the company’s current assets and debtors, that figure stood at £36.7m, up from £33.4million year on year. Of that sum, cash in the bank stood at £7.2million, down from almost £14million in 2023, a reduction likely due to other investments. Indeed, the value of investments was almost £29million, up from £11.4million in the 12 month accounting period prior.

Salah has a multitude of endorsements around the globe, including with the likes of Adidas, Vodafone and Visa, with the income derived from his UK activities coming through his Salah UK Commercial Limited business.

In recent years the addition of image rights agreements in player contracts has taken on far greater significance.

As players have become brands, in some cases being even stronger and compelling to younger generations than the social pull of the clubs themselves, players and agents have realised the brand value that exists, and how it can be monetised.

When a club signs a player they are not only acquiring a talent to aid their competitive goals, but an asset that the club can use to help generate greater revenues through their marketability. For existing or would-be commercial partners, the ability to have their brands associated with top players is compelling and leads to a willingness to pay higher sums to the clubs themselves.

But it is the player’s image, one related to such things as name, trademark characteristics, squad number, social following, and other areas, that is the source of focus and players are now switched on to knowing that they must look after their own interests.

When a club signs a player one of the key agreements to be reached is regarding images rights, and what the club can expect from their player when calling upon them to appear in marketing campaigns for commercial partners. The two parties will attempt to reach as much common ground as possible so that there is little confusion about what is expected of them during a campaign from a commercial perspective. It removes any potential for legal issues.

If a commercial partner wants to use a player for a campaign then the club would have to call upon the player within the confines of the image rights agreement in place and the licence that has been obtained.

“In creating an image rights company, the player will sell their rights to the company itself and will then receive a fee paid directly to the firm from the club for use of their image rights.

It is also beneficial from a tax perspective, with that money received taxed at a 19% company rate as opposed to it being subject to the 45% tax rate that would be applied to players through the salary received from the club. For some players, such methods work as something of a savings account throughout their careers ahead of taking out funds at a later date for them to invest in other areas in later life.

With Salah a UK resident, his overseas earnings could soon become subject to UK taxation law due to new legislation to be introduced by Labour following chancellor of the exchequer, Rachel Reeves, confirming the plans in her Spring Statement last week.

On Wednesday last week, Reeves stood at the dispatch box to deliver her spring statement, within which she addressed the soon-to-arrive changes to non-domicile status for those living in the UK but registered overseas for tax purposes. The headline here is that the changes, set to arrive in April, will continue to be implemented.

These changes are potentially impactful for Premier League clubs because a ‘non-dom’ describes a UK resident whose permanent home for tax purposes is outside the UK. It has nothing to do with their nationality, citizenship or resident status. Non-doms only pay UK tax on the money they earn in the UK and have not previously had to pay tax to the UK government on money made elsewhere in the world, unless that money goes into a UK bank account.

It has been a long-used, and entirely legal method of lowering tax paid by nominating a country with a lower tax rate than the UK as their domicile.

But these changes could be impactful for Premier League players, and the ability of clubs to appeal to some overseas players, due to the potential for monies earned outside of the UK and paid into foreign bank accounts, which can often be for such things as international appearance fees or image rights that haven’t previously been taxed, now subject to UK tax law. For Premier League players that likely makes them liable to pay the top end 45% tax on income over £125,140.

The changes will apply to those who have been in the UK for four years or more from April 6, at which point their offshore income and gains become fully taxable alongside their Premier League wages, which are paid into a UK bank account and subject to UK tax legislation.

This might seem like a small matter, and not immediately impactful for clubs, but with that four-year window comes the possibility of players opting against signing longer-term deals, and that could mean clubs are on the hook for higher amortisation charges in some cases, unable to amortise the transfer fee over the maximum allowed period of five years. Given that the vast majority of major deals involving the signing of high-level overseas talent happen on five-year deals, it presents a potential problem for clubs, including Liverpool and might play some small part in what happens with his longer term future.