Lewis Hamilton Set To Land New £40M Deal With Mercedes As F1 Teams Agree To Cap Salary

Mercedes are faced with salary cap challenges as they prepare to offer Lewis Hamilton a new contract that will potentially keep him in the team for another three years. 

The new measure is expected to be in effect from 2023 and has already been agreed to by all racing team principals, which includes Mercedes principal, Toto Wolff. Should the team hand Hamilton an extension at the end of the season in December, the new deal is expected to run until the end of 2023.

Hamilton, 35, is expected to land a deal worth £40million with Mercedes as he counts to the end of his previous contract. Meanwhile, F1 is working towards a revolutionary proposed salary cap of £22million for star drivers in the sport, according to Sportmail. 

The decision to cap salary is understood to be due to financial constraints inflicted on the sport due to the coronavirus pandemic that caused F1 2020 season calendar to be revised following race cancellations. 

Currently, the six-time champion is the biggest F1 earner with an annual salary of £35million, and that ranked him amongst the world's highest-paid sportsman with total annual earnings of $54m (£41m), according to Forbes.