Liam Rosenior to immediately lose £11m after receiving bumper payoff from Chelsea

Chelsea have sacked manager Liam Rosenior after a dismal run of form but with six years remaining on his deal he is set for a lucrative payout

Liam Rosenior could reportedly receive a payoff of £24million after his Chelsea contract was terminated six years early. But the English head coach would also face a substantial tax bill.

Despite only being hired in January, a run of five defeats without scoring made Rosenior's position untenable at Stamford Bridge. The club relieved him of his duties after 106 days in charge on Wednesday evening.

A 3-0 loss against Brighton on Tuesday, during which his side failed to register a single shot on target, was the final nail in the coffin for the Blues board. The manager's contract was set to run until 2032.

Rosenior was earning £4m per year in west London, according to reports, and further speculation suggests that a total £24m settlement is coming his way. Assuming these reports are correct and there are no clauses in his deal that would prevent it from being paid in full, a large chunk of what Rosenior may receive would go to the taxman.

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The Sun reports that Rosenior is set to be handed the full £24m after his sacking, despite other speculation suggesting there is a break clause in his contract that would significantly reduce the payoff.

If we assume the manager is a UK resident and will receive the £24m, it would be subject to the highest UK income tax rate. Because this figure exceeds £125,140, Rosenior would have to pay tax at a rate of 45 per cent, meaning that a whopping £10.7m would be owed to HMRC in theory.

On top of this, an additional two per cent in national insurance would be owed speaking generally, bringing the total to roughly £11m. A £30,000 tax-free allowance can be deducted from the original £24m before this in line with redundancy rules.

So all in all, if Rosenior does receive the maximum payoff from his long-term Chelsea deal cut short, the fee would generate a UK tax liability of around £11m.

The 41-year-old is the latest in a line of Chelsea managers to see their tenures ended prematurely. Graham Potter, Enzo Maresca and Mauricio Pochettino have all received large financial packages in recent years.

A club statement from the club read: "Chelsea Football Club has today parted company with head coach Liam Rosenior. On behalf of everyone at Chelsea FC, we would like to place on record our gratitude to Liam and his staff for all their efforts during their time with the club.

"Liam has always conducted himself with the highest integrity and professionalism following his appointment mid-way through the season. This has not been a decision the club has taken lightly, however recent results and performances have fallen below the necessary standards with still so much more to play for this season.

"Everyone at Chelsea FC wishes Liam every success in the future. Calum McFarlane will take charge of the team as Interim Head Coach until the end of the season with support from existing club backroom staff, as we strive to achieve European qualification and progress in the FA Cup.

"As the club works to bring stability to the head coach position, we will undertake a process of self-reflection to make the right long-term appointment."