The Australian Athletes Alliance (AAA), an organisation of Australian athlete associations including the PFA, is about to argue before Australia’s highest court – the High Court of Australia – that athletes should be permitted to deduct agents’ fees from their taxable incomes.

The issue arose in two cases, one involving an AFL player, the other a player in the NRL, which were consolidated for argument. The Australian Tax Office (ATO), relying on a 37 year-old High Court decision, refused to allow athletes to deduct agents’ fees. The players challenged the tax office and were successful at the trial court level. The ATO appealed. The appeals court decided in the ATO’s favour because to do otherwise it would have had to reverse a High Court decision – something only the High Court can do.

The AAA sought and was recently granted special leave to argue the case before the High Court.

The AAA’s lawyers will be arguing that the sports business has changed in the 37 years since the previous decision when most athletes were part-time employees.

It is expected the arguments before the court will take place in May and a decision will be handed down by the end of 2009.

PFA Chief Executive Brendan Schwab said that, if successful, players will be rightly able to claim as deductible agent’s fees which are a major expense incurred by professional footballers. However, according to the PFA, many players are already paying disproportionately high agents’ fees of between 6% and 15%, with 10% being quite common. Australian professional footballers will need to be vigilant to ensure agents do not raise their fees further if the court finds in the AAA’s favour. This is because FFA’s players’ agents regulations do not cap agent’s fees unlike other sports such as the AFL.

(PFA Chief Executive Brendan Schwab is a member of the Board of AAA, together with Brendon Gale (AFLPA), Paul Marsh (ACA), Regan Sterry (ASA), Tony Dempsey (RUPA) and Matt Rodwell (RLPA). The AAA Board is chaired by former Socceroo and PFA Life Member Craig Foster.)