The interaction of the spin of an electron in an image state with surface magnetism produces a spin-splitting which can be probed experimentally, most directly using spin-polarised inverse photoemission. There has been some debate about whether the spin-splitting is due to the spin-dependence of the surface potential barrier, or to the spin-dependence of the scattering of the surface state by the crystal potential. We have shown that in the case of image states at Fe(110) both effects contribute, but with opposite sign: the major effect is the effect of the crystal, and the potential barrier which has the opposite spin-polarization reduces the spin-splitting. A splitting of 55 meV is found for the n = 1 state, which has been confirmed by experiment. The dispersion of the spin-split states is discussed, particularly their interaction with the spin-split continua which produces different surface resonance behaviour for the two spins.