Personal Finance: Pros have other rules

Professional footballers and other full-time sports people face a different range of problems in arranging their own finances.

We tend to think of famous faces such as Ryan Giggs or Ian Wright, whose income now should be sufficient to set them up for life. But only about 800 of the UK's 2,600 professional footballers, for instance, enjoy the enhanced earning power of playing in the Premiership. In the lower divisions, many players will be earning little more than the fans.

One thing the Premiership players have in common with their more lowly brethren is that both groups must pack a whole career into a few years.

Mick McGuire, assistant chief executive of the Professional Footballers' Association, says: "The average career expectancy as a professional is eight years, and 50 per cent of those who sign professional contracts are no longer professional in two years' time. Players may be retiring from football at any age from 19 to 40, but the majority are finished at 32 or 33."

This early retirement age means the taxman's usual annuity rules are waived for professional sportsmen. The rest of us may have to wait till 50 or later, but professional footballers can take a retirement annuity at any age from 35 onwards, which will continue to pay them an income until death.

As far as tax relief is concerned, professional sportsmen are subject to the same contribution limits and earnings cap as the rest of us.