Re: Are prize money subject to tax?
Very important is also double-taxing issue. Hrbaty spoke about prize money on tour few years ago. Here are some words :
"After winning tournament, player is holding check for example for 100 000 $. Number of players' accounts are kept in ATP central and tournament sends money directly to ATP central. ATP sends money to players on Monday after final. By Wednesday, they are there. Of course, after tax."
"So basically if I won a tournament in Dubai and had a prize money 100k, I would get 100k on my account because in Dubai is 0% tax from winning. But I would have to pay 19% income tax in Slovakia so I won 81 000 netto after all". (my comment : in Slovakia is now 25% income tax for income higher than 34 000 Euros)
"But there are some more issues. If I won a tournament in Australia, where tax is 48%, I would have only 52 000. And if Australia doesn't have a deal with Slovakia about double-taxing the same thing, I would pay another 19% in Slovakia (now 25%) so I would have only about 42 000 (now 38 000 !)."
He is talking about more things : "Quality coaches cost from 50 000 to 70 000 per annum. Topstar coaches may cost from 500k to million p.a."
By the way, Hrbaty has residence in Monte Carlo, not in Slovakia - but principle is what I am writing about. From 100 000 you would have only 38 000 - and there are surely countries, where you'd have even less.
Now I don't know if Federer has a residence in Switzerland, but he lives in Dubai, so probably in UAE.
Roger Federer - Martin Klizan - Lukas Lacko - Milos Raonic - Fernando Verdasco
Dustin Brown - Nick Kyrgios - Norbert Gombos - Stanislas Wawrinka - Dominic Thiem