CLUBS have got their wish and will be able to pay senior coaches up to 20 per cent of their salary outside the soft cap from next year.

The AFL has also lifted the cap on football department spending by $250,000, bringing the limit to $7.275 million.

>> FULL STATEMENT ON SOFT CAP INCREASE

Since club finances were slashed during the COVID-19 pandemic, clubs and coaches have been pleading with the AFL to lift the cap on spending and help remunerate staff.

"The changes are aimed at providing more flexibility and support as we continue to return back to a position more reflective of pre-COVID times," AFL boss Andrew Dillon said. 

"The establishment of the senior coach deduction recognises the prominent role they play as leaders and ambassadors for their clubs and the sport. 

"We know this was important and we worked closely with the senior coaches to achieve the best outcome we could for 2024."

A new underspend mechanism will also be introduced for next season allowing clubs who spend less than the soft cap limit to carry forward up to $100,000 to the next season.

It can only apply to the following season.

The AFL has also revised the luxury tax rates, with clubs to not be penalised as harshly if they spend above soft cap.