Premier League transfer rule change to come in next season with points deduction threat issued

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The Premier League is scrapping its existing Profitability and Sustainability Rules (PSR) this summer, with a new set of financial guidelines due to be enforced from next season. PSR tracked three-year losses and handed points deductions to the likes of Nottingham Forest and Everton for breaching rules .

The top-flight has now opted to devise a new framework designed to align with UEFA's rules that will introduce the regulation of Squad Cost Ratio (SCR). The rules will limit clubs' on-pitch spending – including player wages, transfers, and agent fees – to a maximum of 85% of their total football revenue (or 70% for clubs competing in UEFA competitions).

SCR covers wages of players and the head coach, agent fees and transfer fee amortisation.‌ The new rules reward financial sustainability as clubs who operate under budget and opt not to spend the maximum 85% allowance for two consecutive seasons are allowed to roll over up to 10% of their unused budget into the following year.

However, clubs who breach the maximum 115% threshold of SCR - which focuses strictly on squad costs - will be slapped with an automatic fine and a non-negotiable six-point deduction.

SCR does deliver financial freedoms to clubs off the pitch who are able to invest in stadium upgrades, academies and infrastructure without it counting against them in regards to the threshold.

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While SCR will officially be brought in next season, it was introduced on a shadow basis throughout the last two seasons. The Premier League opted to do this in order to give financial executives time to adjust to the new regulations while the Profitability and Sustainability Rules (PSR) remained legally in place.

Upon the beginning of the 2026/27 season, clubs will have to submit their estimated football revenue and squad costs which they will base on past campaigns. The Premier League will then run its first SCR Compliance Test during the season on March 1, 2027.

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The figures presented will help set every club’s Green Threshold (85% revenue) and Red Threshold (the maximum spending limit up to 30% above the Green Threshold). An Accounts Confirmation Test will follow at the end of the season in June next year in order to confirm any fines or points deductions.

Should the squad cost be level to or less than the Green Threshold, a club will be deemed compliant with no further action taken. However, should the squad cost be above the Red Threshold, that club will be subject to a sanction.

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