Abstract

Both professional and amateur rugby players participate in community rugby. There is currently no guidance in the South African literature that expressly addresses the possible tax consequences of compensation received by amateur rugby players, if any. The objective of this article is therefore to explore the potential tax consequences of such compensation. The research approach entails an exploratory study, adopting a qualitative research approach in the form of an extensive literature review and an international comparative analysis. The study provides contradictory insights on the common perception that compensation received by amateur rugby players has no tax implications in South Africa. The study found that contracted amateur rugby players are considered employees of community rugby clubs and their compensation, depending on the nature, is in most instances taxable. Non-contracted amateur rugby players whose compensation consists of only the reimbursement of bona fide expenses are not considered employees of community rugby clubs, although reimbursements received may be subject to taxation. The findings are compared to current taxation practices of sports players in Australia, New Zealand, Singapore, and the United Kingdom. The research is valuable to amateur rugby players and community rugby clubs to ensure tax compliance and improved compensation practices.