Date post: | 14-Jun-2015 |
Category: |
Economy & Finance |
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By – ADESH NAHAR
I – Indirect P – Paisa L – Lutto
I – Indian P – Premier L – League
Points
Franchisee Vs. IPL
Team & Financial Cost
Team Mumbai Indians
Owner Mukesh Ambani
Price in USD $112.9m
Price in Rs. 445 Cr.
Price payable per year $11.29m
Financial Model (For IPL)
Income1. Revenue from Auction of Broadcasting right
xxx
Revenue From Broadcast Rights
MAX Symbol & $1.02Billion
Financial Model (For IPL)
Income
1. Revenue from Auction of Broadcasting right xxx
Distribution of Income
1. Share of Broadcasting money with franchisee's xxx
Financial Model (For IPL)
Income
1. Revenue from Auction of Broadcasting right xxx
2. Revenue from title sponsorship & Co. sponsorship xxx
Distribution of Income
1. Share of Broadcasting money with franchisee's xxx
Financial Model (For IPL)
Income
1. Revenue from Auction of Broadcasting right xxx
2. Revenue from title sponsorship & Co. sponsorship xxx
Distribution of Income
1. Share of Broadcasting money with franchisee's xxx
2. Share of Sponsorship money with franchisee’s xxx
Financial Model (For IPL)
Income
1. Revenue from Auction of Broadcasting right xxx
2. Revenue from title sponsorship & Co. sponsorship xxx
3. Revenue from auction of franchisee rights xxx
Distribution of Income
1. Share of Broadcasting money with franchisee's xxx
2. Share of Sponsorship money with franchisee’s xxx
Franchisee Right
Financial Model (For IPL)
Income
1. Revenue from Auction of Broadcasting right xxx
2. Revenue from title sponsorship & Co. sponsorship xxx
3. Revenue from auction of franchisee rights xxx
4. Revenue from sale of ticket
Distribution of Income
1. Share of Broadcasting money with franchisee's xxx
2. Share of Sponsorship money with franchisee’s xxx
Revenue From Ticket Sales
Financial Model (For IPL)
Income
1. Revenue from Auction of Broadcasting right xxx
2. Revenue from title sponsorship & Co. sponsorship xxx
3. Revenue from auction of franchisee rights xxx
4. Revenue from sale of ticket xxx
Distribution of Income
1. Share of Broadcasting money with franchisee's xxx
2. Share of Sponsorship money with franchisee’s xxx
3. Share of ticket money with franchisee xxx
Financial Model (For IPL)
Income
1. Revenue from Auction of Broadcasting right xxx
2. Revenue from title sponsorship & Co. sponsorship xxx
3. Revenue from auction of franchisee rights xxx
4. Revenue from sale of ticket xxx
5. Revenue from official umpire’s sponsorship xxx
Distribution of Income
1. Share of Broadcasting money with franchisee's xxx
2. Share of Sponsorship money with franchisee’s xxx
3. Share of ticket money with franchisee xxx
Financial Model (For IPL)
Income
1. Revenue from Auction of Broadcasting right xxx
2. Revenue from title sponsorship & Co. sponsorship xxx
3. Revenue from auction of franchisee rights xxx
4. Revenue from sale of ticket xxx
5. Revenue from official umpire’s sponsorship xxx
Total xxx
Distribution of Income
1. Share of Broadcasting money with franchisee's xxx
2. Share of Sponsorship money with franchisee’s xxx
3. Share of ticket money with franchisee xxx
4. Inauguration & other expense xxx
Total xxx
Total Income XXX
Financial Model (For Franchisee)Income
1. Share in revenue from Broadcast rights xxx
2. Share in sponsorship Money xxx
3. Share in revenue from sale of tickets xxx
4. Revenue from inside stadium advertisements xxx
5. Sale of Players xxx
6. Revenue from own sponsorship & Co. sponsorship xxx
Total xxx
(-) Distribution of Income
1. Franchisee fees & Player’s Cost xxx
2. Match Fees to Coaches & supporting staff xxx
3. Rent of Stadium & Market / Promotional Cost xxx
4. Inauguration Expenses xxx
5. Fees of Coaches & others xxx
6. Administrative cost xxx
Total xxx XXX
Expense For Franchisee Team & Financial Cost (Cost of Acquisition) Payments to Player’s & Others (Match Fess) Rent of Stadium Inaugural & Marketing Expenses Promotional expenses Cost of travelling & accommodation Cost of Office & support staff Team management Coach Training & Preparation Insurance Ground Expenses Floodlights
IPL & Taxation Service Tax : for providing service to sponsors to
put advertisement on the clothes of the players
Entertainment Tax: Rather than sport event it entertainment event. Tax payable to local government
Capital Gain: (Transfer Value - Acquisition Value)on transfer of Capital Assets (Players)
TDS: As it comes in nature of Professional Services @ 11.33% as per Section 194E.
Capital Gain On Sale Of Player Wethere Capital Asset/Stock In Trade Right To Play % of Dep
IPL & Taxation Income Tax :
Section 28 : Charging section for domestic player as “income received from profession”
Section 115BBA : Income earned by non-resident sportsmen by participating in India in any game or sports and advertisements would be subject to tax in India.
Therefore, Foreign Players & commentator has to pay tax @ 10% as per Section 115BBA of the Income-Tax Act
Effect of Double Taxation Avoidance Agreement
Taxation of Players – Foreign Player
A. Income1. Cost of acquisition xxx2. Match Fees xxx3. Income from article writing in newspaper xxx4. Advertisement xxx
Total xxxB. Expense Not allowed ----
As Per Section 115BBA - Income taxable @ 10% FlatNo need to file returnAny other income
Taxation of Players – Domestic Player
A. Income1. Cost of acquisition xxx2. Match Fees xxx3. And other xxx
Total xxxB. Expense 1. Incurred for same xxx
Total xxx
As Per Section 28 - Income taxable as per slab rate
@nation