Despite Chelsea’s win over Tottenham Hotspur on Tuesday night, they can no longer qualify for next season’s Champions League.
The club’s hopes of Champions League qualification have been hanging by a thread for some time, and were largely bolstered by the hope that Aston Villa winning the Europa League and finishing fifth in the Premier League would see the sixth-placed team in the league qualify. However, Tuesday’s results put that out of reach for Chelsea.
Their highest possible finish is seventh, which would see them qualify for the Europa League, but that relies on at least a draw against Sunderland and Brighton & Hove Albion losing by a number of goals at home against Manchester United. A win for Chelsea and defeat for Brighton would also do it.
Chelsea, as it stands, are eighth, which would mean a place in the Conference League. However, they still need to avoid defeat against Sunderland and rely on a beneficial result when Brentford travel to Liverpool to be guaranteed that spot.
Here, The Athletic explains what missing out on Champions League football — and possibly European competition altogether — means financially in the context of Chelsea’s settlement agreement with UEFA.
What impact does missing out on the Champions League have on Chelsea’s finances?
Champions League football carries far more financial weight than UEFA’s second- and third-tier competitions.
The Athletic estimates that Chelsea’s Champions League campaign this season, which ended in the round of 16 with defeat by Paris Saint-Germain, generated around £80million in UEFA distributions — plus income from the matches they hosted at Stamford Bridge. By comparison, winning the Europa League in 2018-19 earned £40.8m in prize money, and their Conference League triumph in 2024-25 earned £18.3m.
Chelsea have a good chance of securing European football of some kind, but should they qualify for the Europa or Conference League, they carry nowhere near the same financial heft.
Any shot at glory should be welcomed but, in cash terms, the benefits of UEFA’s junior competitions to a club carrying Chelsea’s operational costs are marginal; in the Conference League, which often involves substantial travel and where home games pale in significance to Champions League fixtures, it’s debatable whether the club even turns a profit from participation.
Chelsea’s Champions League campaign generated significant revenue (Mike Hewitt/Getty Images)
What is the settlement agreement and what happens if Chelsea breach it?
There is particular focus on Chelsea’s finances because of the extra conditions imposed on them by a settlement agreement with UEFA.
In July 2025, the club were fined for breaching UEFA’s football earnings rules (€20m) and squad cost rule (€11m). The squad cost rule breach was punished by a one-off fine. It is the football earnings breach that is being managed under a four-year settlement agreement, and that is a cause for concern going forward.
In simple terms, the football earnings rule is UEFA’s mechanism designed to limit club losses. Clubs are allowed €60m in ‘adjusted losses’ over a rolling three-year period. That limit can be increased by €10m per season, for a total of €30m in a three-year assessment period, as long as clubs comply with the financial conditions UEFA uses to assess whether or not they are in good health.
In simple terms, the agreement sees Chelsea:
- Limited to a maximum €60million (£52m) Football Earnings deficit in the 2025-26 season;
- Limited to zero losses in 2026-27, which can be extended by any headroom the club has in its 2025-26 Football Earnings calculation, up to a maximum of €60m; and
- Limited to a maximum of €60m in Football Earnings losses (increasable to €90m if various ‘good’ financial conditions are showcased, though English clubs generally fail to do so) in the three seasons spanning 2025-26 to 2027-28.
If Chelsea exceed any of those individual targets by less than €20m, they’ll receive a fine proportional to the excess (up to €20m). If they exceed any of those by more than €20m, UEFA will deem them in breach of the settlement agreement, terminate it and ban them from its competitions for a season.
What does that have to do with European qualification?
Compliance with the settlement agreement looks feasible for the 2025-26 season, but next season or the one after look more difficult without Champions League football.
As explained above, the prize money for competing in the Europa or Conference League is far lower. Also, fans and sponsors will not stump up the same money as they would for a Champions League campaign.
Many of Chelsea’s players are on incentivised contracts and will see their wages fall in a campaign without Champions League football. Yet even in 2023-24, when Chelsea played no European football and did not qualify for the Champions League during that season (and so had no such bonuses to account for), the club’s wage bill was still £338m. They would have other costs that a failure to qualify will not take away, either. For example, their player amortisation bill was £212.2m in 2024-25, and that will be a higher figure in UEFA’s calculations as they limit player amortisation periods to five years.
If Chelsea did receive a ban, when would it be enforced?
If UEFA find Chelsea in breach of their settlement agreement, the terms of the agreement say that the club would be excluded “from the next one applicable UEFA club competition for which it would otherwise qualify in the following three seasons”. In that event, the settlement agreement would be terminated and the club would effectively start afresh, with the same regulations as any other side, after serving that ban.
That applies equally whether that competition is the Champions, Europa, or Conference League. There is therefore a theory that the club could somehow engineer things to serve a ban in a season where they qualified for the Europa League or Conference League, missing out on those less prestigious and less lucrative competitions rather than a Champions League campaign, then starting over. However, that is not really the case.
To use a hypothetical example, let’s say Chelsea finish eighth this season and qualify for the Conference League. They cannot simply decide to take a ban next season. Firstly, it seems likely they can comply with the settlement agreement this season anyway. But even if they were in breach, loss limits are adjudicated upon retrospectively — so any 2025-26 breach would likely be discovered during 2026-27, while they would already be competing in the Conference League in our hypothetical scenario. The ban would be applied to the following season instead. By the same logic, if Chelsea were to breach the agreement next season, a ban would likely await in 2028-29.
A ban would apply to any European competition (Dean Mouhtaropoulos/Getty Images)
What impact could this have on transfer business?
As well as the obvious point that being in the Champions League helps attract talent, the missing revenue from not being in the competition means Chelsea will need to take extra care to stay within the settlement agreement. That includes their transfer spending, which has been enormous in the past few seasons.
As The Athletic have reported, Chelsea are intending to sign at least two starting-calibre players this summer. Given the financial situation, it is even more important that those are the right players for the right prices.
What’s more, Chelsea’s business model involves player trading and generating profitable sales. The club’s financial statements detail the two most important factors in determining whether future extra funding is required from their BlueCo owners: “the net impact of future player transfer activity and on-pitch performance of the men’s football team”.
If one of those drops off, the other will be even more important to club finances. Chelsea need Champions League football for BlueCo’s project to add up; without it, player sales, at a level beyond that already baked into the club’s strategy, will be required.
