MORE than 300 top-flight footballers are avoiding millions of pounds of income tax by using loopholes that Gordon Brown pledged to close more than a decade ago.

The players and dozens of managers are declaring themselves non-domiciled or claiming non-resident status by commuting in and out of Britain for matches and training sessions.

The tax breaks have helped to attract some of the world’s best footballers to Britain, but also mean that, despite their multi-million-pound earnings, many of them are paying lower rates of tax than their supporters.

In total, 302 footballers or managers have “non-domiciled” status in Britain and a further 67 claim they are “not resident”, according to Treasury documents released under the Freedom of Information Act.

Among those who qualify for non-domiciled status are the Manchester United stars Cristiano Ronaldo, who is Portuguese, and Owen Hargreaves, who was born in Canada but plays for England. Their representatives declined to comment.

David Beckham’s spokesman said that he was non-resident in Britain for tax purposes but would pay tax on his earnings in America.

Almost half the players in the Premiership are from overseas, and the poor showing of the national team is blamed by some on the displacement of home-grown players by foreign stars. Sven-Goran Eriksson, the former England coach who is now managing Manchester City, is thought to be a beneficiary of the tax loophole.

A source familiar with the arrangements of managers said: “Non-domiciled status is a perfectly legal status. It’s automatic if people like Sven wish to have it.” Brown pledged to close the loopholes in opposition but has so far failed to act despite the scheme being “under review” by the Treasury since 2002.

Accountants and lawyers have devised sophisticated ways for Premiership stars to benefit from the loophole. The non-domiciled players must be born abroad or have parents born abroad. They typically sign multiple contracts for their services.

One contract pays the player for matches in Britain. They have another, more valuable contract for their “global image rights”, which covers the money earned by the club to sell their merchandise and television rights. A third contract pays for any foreign appearances.

British tax is typically paid only for money earned on the first contract, with money earned on the other contracts paid tax-free to an offshore tax haven.

In contrast, players in Spain must pay tax to the Spanish government on their worldwide earnings.

A memo from a Revenue official in May 2005 about the nondomicile system states: “Quite a lot of the ND [non-domicile] and NOR [not ordinarily resident] cases dealt with . . . were either professional footballers or professional football coaches/mana-gers. Top football players and managers earn large amounts of money and so may well have relatively complex tax affairs.”

Mike Warburton, a tax partner at Grant Thornton, the accountants, said: “It is definitely an important draw for foreign players and these rules have certainly been a factor in the Premiership becoming the top league in the world.”

A football agent who represents several household names said: “I have heard of people flying in and out of the country for training sessions and matches – particularly managers. It is a game now staying one step ahead of the tax authorities.”

Footballers are the latest group to be identified as beneficiaries of loopholes offered to the global super-rich by Britain. The heads of private equity firms have recently come under criticism after it emerged they paid tax at a rate of less than 10% on multi-million-pound earnings.

Vincent Cable, the Liberal Democrat Treasury spokesman, said: “We need an open and transparent investigation into the use of nondomicile, followed by a tightening of the rules. The number of nondoms is rising rapidly as people realise the easy pickings on offer.”

A Labour peer said: “The situation does seem to be becoming deeply unfair. These guys [footballers] are paying lower rates of tax than the working men paying a fortune to watch them.”

The Treasury documents reveal that there were 77,000 nondomiciled people in Britain in 2002, avoiding an estimated £1 billion in tax. The number is understood to have risen to almost 200,000 since then.

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