A player joins a French club from abroad. Their adviser proposes taking part of their image income out of salary, as a royalty paid by the club: lower contributions, a higher net. The arithmetic looks unanswerable. What no one adds is that the player is also on the impatriate regime, that this royalty may shrink an exemption they already hold, and that, once everything is counted, moving income out of salary can cost more than it saves.
Everyone sells the image royalty as a straight win: out of salary, out of contributions, job done. It is not that simple. For a domestic player it can be a real lever. For a player recruited from abroad, on the impatriate regime or having opted out of the French pension system, it collides with other reliefs in ways almost no one runs the numbers on. That collision is worth tens of thousands of euros.
It comes from article L. 222-2-10-1 of the French Sports Code, introduced in 2017. A club, whether an association or a sports company, may sign a second contract with the player it employs, separate from the employment contract, covering the commercial use of their image, name or voice.
The royalty paid under that contract is not salary, and not pay for work. So it falls outside the social contributions that hit salary. That is where its appeal comes from, and its danger with it.
The rules are tight, and missing any one of them turns the royalty back into salary, with contributions reassessed on top.
The player's physical presence must not be needed to exploit their image. The royalty must track the revenue that exploitation actually generates, not the salary. A ceiling on the royalty and a minimum salary threshold are set by collective agreement, sport by sport. And the contract must reach the supervisory body without delay.
None of this is a clause you slip into a corner of the employment contract. It takes a collective agreement for the sport, a ceiling held, a salary threshold cleared and a filing made. A royalty pegged to a share of salary, or paid over the industry ceiling, is not a royalty. It is salary in disguise, and URSSAF, the French social security collection authority, treats it as such.
It tries, and the litigation is live. For club and player alike the exposure is heavy: reclassification as salary, employer and employee contributions reassessed across several years, plus penalties.
But these cases are won when the arrangement is built properly. The recent rulings go against URSSAF (French social authorities) where the contract genuinely meets the statutory conditions, and go its way where the royalty was salary under another name. Everything turns on the initial structuring, the drafting and the reality of the commercial exploitation. You settle that before signing, not once the audit lands.
More. The club pays the royalty, and the club carries the employer contributions if it is reclassified. Across a full squad on one template, the exposure is not one player. It is every season the template has been in use.
A club that has run all its image contracts off a single model, without securing it, carries one risk many times over. A single URSSAF audit can pull on every contract and reach back several years. For a finance director the question is not whether one contract holds. It is whether all of them do. That is an audit, not a quick opinion.
No, and this is the part nobody mentions.
The royalty escapes contributions, but it buys nothing in return: no pension, no cover, no benefits. For a player near the end of a career, or building a French pension, shifting large sums out of salary hollows out rights that cannot be rebuilt. The saving on contributions is not a gift. It is a cost pushed onto the player's future.
And the calculation gets harder the moment the player holds other reliefs, which is nearly every player arriving from abroad.
A player recruited from abroad is often on the impatriate regime of article 155 B of the French Tax Code. That regime exempts part of their pay from income tax, either a genuine impatriation premium or, by election, a flat 30% of pay.
That 30% is measured against pay. Shift income out of salary into an image royalty and you shrink the very base the exemption runs on. The player picks up a saving on contributions, and risks handing back exempt income to get it.
Which way does it net out? It turns on the amount, the image share, the salary level, the option taken under the impatriate regime. Exactly how the royalty feeds into the 30% base is a technical question neither the law nor the official guidance answers cleanly, and it has to be worked case by case. What is not in doubt is that you cannot decide the royalty without looking at the impatriate regime in the same breath. Handle them apart and you optimise one by wrecking the other.
The sum shifts again. A player recruited from abroad can, on conditions, opt out of French old-age insurance. If they have, they already skip certain pension contributions on salary.
So part of the reason to leave salary falls away: the saving the royalty would have made on those contributions is gone, because the player never paid them. The royalty still bites on the other contributions, but the margin tightens, and the trade is no longer the one a normally enrolled player faces.
Image royalty, impatriate regime, pension opt-out: three levers pulling on the same pay, at the same time, sometimes against each other. Pull one without watching the other two and you are moving a single piece across the board with your eyes shut.
The royalty is not reserved for players from abroad. A French player qualifies on the same terms, and faces the same trade: a saving on contributions against a loss of social and pension rights. With no impatriate regime and no pension opt-out in the balance, their sum is simpler, but no more neutral. For a player in mid or late career, the pension usually outweighs the money saved today.
Whether, in your case, the royalty earns you more than it costs you in impatriation relief. How to line it up with your pension opt-out. Which industry ceiling covers your sport, or whether your contract would survive a URSSAF audit. Which slice of your image income is really salary, and which slice can properly leave it.
The image royalty is neither a trick nor free money. It is a governed regime, contested by URSSAF, and its real worth depends on your whole tax and social security position. For a player arriving from abroad it is never a standalone call: you run it alongside the impatriate regime and the pension, or it turns on the player it was meant to help.
Lobe Law, a Paris law practice specialising in sports taxation and international mobility, works out the trade between salary, image royalty and the reliefs around them, and secures your contract. Book a consultation.