Does IPL have a ceiling for player salaries? Explaining team purse as top stars demand Rs 40 crore

Some of the Indian Premier League’s biggest names are reportedly asking for Rs 40 crore to remain with their franchises when next year’s mega-auction comes around.

According to Cricbuzz, several top-tier players have quoted that figure as the retention fee they want, and at least a couple of them are believed to have told their teams that they would stay only if the amount is paid in full.

More players could follow the same path, particularly those who feel they would earn even bigger contracts by going into the auction. In at least one of the current cases, the financial demand is also understood to be linked to the captaincy,

There is already a precedent for stars turning down retention to see what the market would offer.

Shreyas Iyer and Rishabh Pant both refused to be kept by their then teams before the 2025 mega auction, and both were rewarded handsomely, with Iyer fetching Rs 26.75 crore and Pant going for Rs 27 crore.

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Does IPL have a ceiling for player salaries?

For Indian players, there is no official hard limit on what a single contract can be worth. In an open mega auction, a player’s price can climb as high as the money a franchise has available allows, which is how Pant and Iyer reached the figures mentioned above.

The more practical limit comes from the squad itself. Teams must build a group of 18 to 25 players within BCCI composition rules, so a very large payment for one person leaves less money for everyone else.

Overseas player salary cap in the IPL explained

Foreign players are treated differently.

In mini-auctions, an overseas player’s take-home pay is capped at the lower of two numbers, namely the highest retention slab of Rs 18 crore or the highest winning bid at the preceding mega auction, which was Rs 27 crore.

The effective cap is therefore Rs 18 crore. If a franchise bids more than that, the excess is deducted from its purse and sent to the BCCI Player Welfare Fund, so the player does not receive it.

IPL team purse explained

To understand whether a demand of this size is realistic, one has to look at the overall purse available to each franchise.

Pant’s Rs 27 crore deal was struck when the total purse stood at Rs 120 crore, and the figure is expected to rise to around Rs 150 crore for the next mega auction. No formal discussions have been held yet, so that number is not confirmed.

The purse has grown a great deal since the league began in 2008, when each franchise had only Rs 20 crore to spend, an amount that individual player salaries have exceeded in recent seasons.

Franchises are required to spend at least 75 per cent of the total purse, and the figure itself is set for each three-year cycle, with annual increments of Rs 5 crore in 2026 and 2027 after the Rs 120 crore base in 2025.

YearTeam purse2008Rs 20 crore2014Rs 60 crore2018Rs 80 crore2022Rs 90 crore2025Rs 120 crore2027Rs 150 crore (Expected)

Can an IPL franchise afford a Rs 40 crore retention fee?

This is where the arithmetic becomes difficult.

Against a purse of Rs 130 crore, a Rs 40 crore contract would eat up roughly 30 per cent of the total, and at the expected Rs 150 crore, it would still account for a little over 25 per cent of the money.

That is a substantial commitment for a single player, especially for franchises with several marquee names to retain.

Even so, the larger purse is an important part of the equation, and contracts in this range are not entirely beyond consideration in the next cycle. The final answer will depend on the retention rules, the number of players a franchise wants to keep and how much it is willing to place on one individual.

Are there IPL retention slabs?

Retention slabs will also play a role in the calculations. For the previous mega auction, the BCCI prescribed amounts of Rs 18 crore, Rs 14 crore and Rs 11 crore.

Franchises were nevertheless allowed to pay more than those figures as long as they declared the real amount. Heinrich Klaasen was paid Rs 23 crore under this arrangement, while Nicholas Pooran received Rs 21 crore.

IPL match fees and other income for players

A player’s earnings are not limited to the auction price. Every member of the playing XI, including the Impact Player, receives a match fee of Rs 7.5 lakh, which adds roughly Rs 1.05 crore across 14 league games.

Direct pay from a franchise is bound by BCCI contracts.

Any further income comes from independent brand endorsements or from deals with sister franchises in global leagues such as SA20, MLC and ILT20.