Featured in The Athletic: Tax Challenges for Canadian Teams – Insights from Chris Slawson and Kris Rossignoli on How Recent Rulings Could Deter Top Talent
In a recent article in The Athletic titled” ‘Anywhere but Canada’: How a tax ruling could hobble pro teams north of the border,” Chris Slawson, a director at Cardinal Point Athlete Advisors, and Kris Rossignoli, a Cross-Border Tax and Financial Planner, discuss the complex tax landscape professional athletes face when playing in Canada. The piece highlights the story of John Tavares, who signed a $77 million contract with the Toronto Maple Leafs in 2018, only to face a hefty $8 million tax bill years later due to a reassessment by the Canada Revenue Agency (CRA). This reassessment challenges athletes’ traditional tax strategies to minimize their obligations, putting millions of dollars at stake.
Slawson and Rossignoli explain how the U.S.-Canada tax treaty, which previously allowed athletes to pay lower taxes on signing bonuses, is now under scrutiny. The CRA’s aggressive stance could deter athletes from signing with Canadian teams due to the higher tax rates and potential legal battles. They emphasize the importance of considering both the ‘gross’ and ‘net’ values of contracts and how lifestyle, family, and team competitiveness also influence players’ decisions. The article underscores the potential long-term impact of these tax rulings on the attractiveness of Canadian teams for top talent.