There is constant discussion in football about ways to limit the clubs’ annually increasing salaries and transfer spending. So far, there is no uniform solution from UEFA or FIFA. There are many ideas, especially from US sports with their salary cap and draft system, which has always ensured sporting balance. Of course, this cannot be implemented 1:1 in European football, as the top leagues in the USA are closed leagues and operate without promotion and relegation. Nevertheless, individual leagues are trying to introduce their own new rules, such as the PSR (Profitability and Sustainability Rules) in the Premier League or the so-called Squad Cost Limit in La Liga.
Before we analyse the figures for each club together, let us explain what the squad cost limit is and how it is calculated. In general, the squad cost limit is all the money a club is allowed to spend during the season on the transfer market and on its team. This is divided into registrable and non-registrable parts. The registrable part includes transfer expenses, player salaries, coach salaries and the costs for assistant coaches and fitness trainers. The non-registrable part includes expenses for the reserve team, youth teams and other expenses. Regardless of whether the costs are registrable or non-registrable, both parts include the costs for fixed and variable salaries, collective bonuses, social security, transfer fees including payments to player agents, and amortisation for players (purchase price of the players, calculated annually according to the player’s contract term).
Contrary to popular belief, the squad cost limit for each individual club is not set by La Liga. The clubs submit a specially prepared summary (based on forms provided by La Liga) of all squad costs, which must then be approved by the La Liga Validation Body. The amount submitted does not have to be the highest limit that a club can reach. For example, it is sufficient to submit all costs required to register the entire team and coaching staff, even though a higher limit could have been approved due to the club’s financial situation. It is also interesting to note that in special cases, the squad cost limit does not have to be the actual upper limit for team costs. This is discussed in a separate paragraph in this article. Here is a list of the squad cost limits for the 2025/26 season as of the end of the 2025 summer transfer window. After the winter transfer window, this may be adjusted due to transfer movements or changes in a club’s overall balance sheet. The squad cost limit figures were published by La Liga and compiled by Football Finance Lab in this table.
Real Madrid – the royals alone on the royal throne
When looking at the pure numbers, several things immediately stand out. The first striking thing is the huge gap between Real Madrid and the rest of the league. Real Madrid is in first place with 761 million by a huge margin. The fact that Real Madrid is in first place is not surprising due to the historical dominance of the giants Real Madrid and FC Barcelona, but it does contain something surprising. Real Madrid has a squad cost limit more than twice that of Atletico Madrid and FC Barcelona, which combined amount to around 677 million euros, which is still almost 90 million euros less than the SCL of the Royals. This serious difference comes mainly due to Barcelona’s high level of debt and repeatedly causes Barca to have major problems registering players. Barca has repeatedly tried to increase its Squad Cost Limit in recent years by trying to generate revenue in the short term. This was mostly attempted by bringing forward future revenues, such as the sale of merchandising rights or the sale of future TV revenue. In addition, FC Barcelona repeatedly sold players in order not to report them under the squad cost limit and to further increase the limit through transfer revenue. Financial problems of some La Liga clubs are also the reason for the introduction of the Squad Cost Limit, according to Javier Tebas, the league president. The reason for this is not to ensure greater sporting equality within the league, but rather to force clubs to spend less money and thereby become more and more indebted. Looking back at the numbers, there is not only a huge hole between Real Madrid and the rest, but also again between second-placed Barcelona with 351 million euros and city rivals Atletico Madrid with 326 million euros and the rest of the league. Atletico’s 351 million euros are about twice as much as the 173 million euros of fourth-placed Villareal FC.
Villareal FC leads a group in the Squad Cost Limit that is roughly on the same level and consists mainly of La Liga participants in European competitions in recent years. Real Sociedad, Athletic Bilbao and Real Betis Sevilla follow in the other places. These are all at approximately 128-125 million euros Squad Cost Limit. The next group to follow consists of Valencia CF, Celta Vigo and Girona FC. Valencia and Celta are both around 91 million euros, while Girona is slightly behind at 75 million euros. It is somewhat surprising that Valencia CF is so high up in the squad cost limit, as there is repeated talk of severe financial problems at the club. For example, the new Nou Mestalla stadium has been permanently suspended due to costs since construction was halted in 2009. The next block consists of 4 more teams, led by RCD Mallorca with approximately 60 million euros. The remaining three teams are the previous surprise team Espanyol Barcelona with 56 million, Osasuna with 54 million and Getafe FC (50 million euros). The penultimate group includes Rayo Vallecano (approx. 47 million euros) and Real Oviedo (approx. 45 million euros) two clubs that come from very different situations. Rayo is this year’s European Cup participant, and Oviedo is promoted. The current bottom team is therefore also the promoted team with the highest squad cost limit. Deportivo Alaves and co-promoted FC Elche complete the category with approximately 40-41 million euros each. UD Levante is currently not only second to last in sporting terms, but also second to last in the Squad Cost Limit with approximately 35 million euros.
At first glance, Sevilla is last, but keeps them La Ligas special rule really last?
Sevilla FC is bottom of the table with just 22 million euros. This puts Sevilla in last place by a clear margin. With only 22 million euros, one might also ask how one is supposed to finance a squad ready for the first division. At first glance, this looks impossible. However, La Liga has ensured that clubs that can only register a very small squad cost limit due to their financial difficulties have the option to exceed it. Thus, article 34, paragraph 3, of La Liga’s Budget Preparation Rules states paraphrased: in order to achieve a minimum sporting level of each team, it may suspend the Squad Cost Rule and spend a maximum of 30% of the projected net revenue (which must additionally be budgeted and accepted by the Validation Body) on its team. Sevilla FC had net sales of 115 million euros in the 2024/25 financial year. If we now take the permitted 30% of this value and assume that La Liga’s Validation Body also approves it, Sevilla FC would end up with permitted squad costs of 34.5 million euros. That’s roughly on the level of UD Levante and that would keep Sevilla in last place. However, Sevilla will probably report a higher projected net turnover and try to get it released by La Liga. As a final conclusion about Sevilla FC, La Liga’s rules ensure that they are at least allowed to spend enough on their squad to be able to compete realistically in the Spanish elite league. However, it is just enough to be able to participate in the relegation battle purely after the finances.
La Liga vs Bundesliga: How Squad Cost Limits Compare to German Club Spending
Although there is no squad cost limit in the Bundesliga, in our last article we analyzed the squad costs of each club from last season (read the article here). If we look at the comparison between the Bundesliga’s personnel costs from the 2024/25 season and La Liga’s Squad Cost Limits this year, it is striking that Bayern Munich (although equally prestigious Real Madrid and FC Barcelona) cannot even come close to matching Real Madrid’s Squad Cost Limit. Although FC Bayern plays in its own league throughout Germany, with its 429 million euro squad cost expenditure, it would clearly be ranked second in La Liga.
It is also interesting to see that Borussia Dortmund in second place and RB Leipzig and Bayer Leverkusen in the next places are ranked behind Barca and Atletico, but also ahead of fourth-placed Villareal FC. VfB Stuttgart, Eintracht Frankfurt and VfL Wolfsburg would be included in the group led by Villareal, which is also appropriate given the regular participation in European competitions in Frankfurt and Stuttgart. Overall, La Liga has a higher limit of approximately 2.7 billion euros in squad costs than the 18 Bundesliga clubs with 2.17 billion euros in squad costs. La Liga is also ahead in terms of average value. La Liga is around 135 million euros per club, the Bundesliga 120 million. It is also interesting to see that although the average is high in each case, the distribution in the Bundesliga is somewhat more equal. In La Liga, only 4 teams are above average, while in the Bundesliga there are at least 7 teams. It is also exciting that Sevilla FC, as described in the last section, is in last place in La Liga with approximately 22 million euros and is allowed to spend more due to the special rule on sporting integrity. Holstein Kiel is last in the Bundesliga with approximately 21 million euros for personnel costs. This at least raises the question of how high Kiel’s chances were of staying in the league. From the point of view of La Liga’s rules, this was not possible.