Isobel FraserLiverpool's summer 2026 acquisition of Victor Muñoz from Osasuna — triggering his €40 million release clause while Spain trained in Tennessee — made headlines for the competitive drama: Newcastle United had arranged a medical before Liverpool moved ahead of them. Less discussed was what Muñoz, 22, faces in the weeks after touching down at Anfield. He has just become a UK tax resident for the first time, on a six-year contract worth several million pounds per year. How he structures his finances in the first 90 days could determine his total tax position for the next decade.
Liverpool, Newcastle, and How Release Clauses Actually Work in England
The Muñoz transfer is a textbook example of how La Liga's buyout clause mechanism operates. Osasuna had reportedly agreed terms with Newcastle United, with a medical scheduled. Liverpool then triggered the release clause directly — exercising a contractual right that cannot be blocked once the full sum is paid to the selling club. Newcastle had no legal recourse.
This mechanism does not function the same way in English football or employment law. A Premier League club cannot insert a fixed release fee that a third party can unilaterally trigger: the clause must be written into the individual contract, its amount agreed by both parties, and its enforceability depends on precise drafting. An employee in any UK sector who asks whether they can simply "buy themselves out" of a notice period will get the same answer from an employment lawyer: it depends entirely on what your contract says.
The key principle under English law is that a restraint of trade clause — including a non-compete or a long notice period — is only enforceable if it is reasonable in scope and duration. A clause that attempts to prevent someone moving to a direct competitor indefinitely is likely unenforceable. But a clause that simply says "you may leave early if you pay a set fee" is entirely valid, and without that clause, no such right exists. For the thousands of professionals who negotiate employment contracts each year, understanding which protections you have — and which you do not — before you sign is exactly the kind of scenario where early legal advice pays for itself.
For analysis of how high-profile contract renewal decisions weigh financial against sporting considerations, see Marcos Llorente's contract dilemma at Atlético Madrid, where similar structuring choices shaped his outcome.
The Bigger Picture: Arriving in the UK as a High Earner in 2026
For Muñoz, the transfer fee belongs to Osasuna. What he controls is his own financial position as a new arrival. The first significant decision he and his advisers must take is whether to claim the Foreign Income and Gains (FIG) relief — introduced by HMRC from 6 April 2025 to replace the former non-domicile regime.
The FIG regime is available to any individual who has not been UK tax resident in any of the preceding 10 tax years. For someone like Muñoz — arriving from Spain in the summer of 2026 with no prior UK tax history — the relief is almost certainly available. Under FIG, all foreign income and gains are exempt from UK income tax and capital gains tax for the first four complete UK tax years of residence.
The exemption covers rental income from overseas property, dividends from foreign-incorporated companies, capital gains on overseas assets, and — critically for elite athletes — commercial income from image rights arrangements structured outside the UK. According to HMRC's guidance on foreign income, the key principle is that income arising outside the UK can be kept offshore without triggering a UK liability, provided it is not brought into the country during the relief period.
The relief is not automatic. It must be claimed via self-assessment each tax year. And it interacts with a rule that catches many new arrivals: once foreign income is remitted to a UK bank account, it loses its exempt status — permanently, for that tax year.
Why Image Rights Change the Calculation Significantly
Professional footballers at elite European clubs routinely receive a portion of their total remuneration through image rights companies — entities incorporated to receive fees paid for using a player's name, likeness, or appearance in advertising campaigns. The reason is structural: image rights income is legally distinct from employment income and, when properly structured, can be paid to a company rather than to the individual directly, at a substantially lower effective rate than the 45% UK additional rate that applies to employment earnings above £125,140.
HMRC scrutinises these arrangements carefully. The test is whether the split between employment income and image rights income reflects genuine commercial reality. For a 22-year-old who has just appeared in a World Cup final with Spain and completed a £34.5 million Premier League transfer, the commercial value of those image rights is both genuine and substantial — not a fiction created for tax purposes.
The practical question for any high earner arriving in the UK with pre-existing foreign commercial arrangements — not just footballers, but senior executives, consultants, and entrepreneurs — is whether those arrangements have been reviewed by a UK-qualified financial adviser before the first payment lands. An arrangement that is perfectly legal under Spanish law may create unexpected tax exposure in the UK if the income flows are not structured with HMRC's rules in mind from day one.
The 90-Day Window: What the Numbers Look Like
Consider James, a 30-year-old senior analyst who accepts an offer from a City fintech firm in September 2026, relocating from Madrid where he has worked for six years. His UK annual salary is £240,000. He also receives €80,000 per year in rental income from a flat he owns in the Salamanca district of Madrid — income on which he pays Spanish income tax at approximately 19-24%.
James qualifies for the FIG regime: he has never been UK tax resident. His Madrid rental income is foreign income.
Scenario A — James claims FIG in his first UK self-assessment (31 January 2028 deadline): The €80,000 rental income — approximately £68,000 at October 2026 exchange rates — is exempt from UK income tax for his first four full UK tax years. At the 45% additional rate that applies to income above £125,140, the annual tax saving is approximately £30,600. Over four years: £122,400 in tax not paid to HMRC.
Scenario B — James does not claim FIG, or remits the rental income to his UK current account before taking advice: The income becomes immediately chargeable to UK income tax. The UK-Spain double taxation treaty provides relief for Spanish tax already paid, but where the effective Spanish rate (19-24%) falls below the UK additional rate (45%), a top-up liability applies. On €80,000 with Spanish tax already paid at 22%, the UK top-up could reach £15,600 per year — £62,400 over four years, compared to zero under Scenario A.
The difference between the two scenarios is not the law itself — it is timing. James in Scenario B lost the FIG benefit not because he was ineligible, but because he acted before he understood the rules. A wealth adviser engaged within the first 90 days would have identified the issue before the first payment crossed into a UK account.
Four Actions a Wealth Adviser Prioritises in Year One
For any high earner arriving in the UK — whether a Premier League footballer, a financial professional, or a senior manager relocating for a multinational — the sequence of financial priorities is consistent:
1. Confirm UK residency date precisely. The Statutory Residence Test (SRT) governs when UK tax residency begins. For someone arriving mid-tax-year, split-year treatment rules apply, and the exact date affects which income streams fall inside the first UK tax year. An error of a few weeks can shift significant income in or out of the FIG window.
2. Register for self-assessment immediately. HMRC requires registration by 5 October of the tax year after arrival. Failure to register on time can result in penalties of up to 100% of the unpaid tax.
3. Review all foreign income streams before remitting funds to the UK. Under FIG, foreign income is exempt only if it remains offshore. The order in which funds are transferred — governed by the mixed funds rules — has created costly and difficult-to-reverse errors for new arrivals who moved money without advice.
4. Appoint a specialist adviser, not a general accountant. UK international residence tax is a specialist area. The rules changed materially in April 2025, and advisers who do not regularly work with new arrivals may not be fully current on how the FIG regime interacts with double tax treaties, image rights structures, and pension contributions.
When Early Advice Pays for Itself
HMRC's compliance activity around high-earning new arrivals has increased since the 2025 non-dom reforms. Enquiries that were once focused on established long-term residents now routinely open within 18 months of a new arrival registering for self-assessment. A wealth manager who specialises in international relocation will structure the year-one position in a way that is not only optimal but defensible under scrutiny.
Victor Muñoz arrived in Liverpool with a professional advisory team behind him. For the many thousands of professionals who relocate to the UK each year without that infrastructure, the lesson from his high-profile move is straightforward: the decisions made in the first 90 days of UK residency carry consequences that compound over a decade. The cost of specialist advice in year one is a fraction of the tax at stake.
This article contains general information about UK tax rules. It does not constitute personalised financial or tax advice. Readers should consult a qualified financial adviser or tax specialist for guidance specific to their circumstances.
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