Glasgow Rangers What Have You Done
13 February 2012, 06:21 PM
#1
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Glasgow Rangers What Have You Done
£49 Million in debt, what do you think will happen now.
http://www.dailymail.co.uk/news/arti...-tax-case.html
http://www.dailymail.co.uk/news/arti...-tax-case.html
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13 February 2012, 08:18 PM
#8
Difficult to see them getting out of this if they lose the tax tribunal case. They can only exit administration with the agreement of 75% of the creditors. HMRC is owed £49M which is likely to be significantly more than 25%, and they will almost certainly block any deal.
Does anyone know the ins-and-outs of the tax dispute? Sounds like it dates from before Craig Whyte's reign, but it was hoping it would go away rather than planning on having to pay. I also read he has raised £24.4M from Ticketus in return for the next three year's season ticket revenues, so they could be facing a big write-down.
Does anyone know the ins-and-outs of the tax dispute? Sounds like it dates from before Craig Whyte's reign, but it was hoping it would go away rather than planning on having to pay. I also read he has raised £24.4M from Ticketus in return for the next three year's season ticket revenues, so they could be facing a big write-down.
14 February 2012, 10:20 AM
#20
I can never understand how anyone can run up a tax bill of £100,000 let alone one of millions?
What are HMRC playing at?
They will chase people who owe £50 from pillar to post, giving out £100 fines along the way, while these people just don't pay?
Or will this be another Vodaphone fiasco?
What are HMRC playing at?
They will chase people who owe £50 from pillar to post, giving out £100 fines along the way, while these people just don't pay?
Or will this be another Vodaphone fiasco?
14 February 2012, 11:32 AM
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14 February 2012, 12:25 PM
#23
Pontificating
Celtic fans would be gutted if Rangers went out of business and the SPL probably wouldn't survive either, Scottish football is nothing without the old firm games, I can't see Celtic Hearts having the same pulling power.
Stupid to borrow against season ticket sales, they won't earn enough in match day revenue from the walk ins to service the debt.
Stupid to borrow against season ticket sales, they won't earn enough in match day revenue from the walk ins to service the debt.
Last edited by Funkii Munkii; 14 February 2012 at 12:28 PM.
14 February 2012, 12:29 PM
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I can never understand how anyone can run up a tax bill of £100,000 let alone one of millions?
What are HMRC playing at?
They will chase people who owe £50 from pillar to post, giving out £100 fines along the way, while these people just don't pay?
Or will this be another Vodaphone fiasco?
What are HMRC playing at?
They will chase people who owe £50 from pillar to post, giving out £100 fines along the way, while these people just don't pay?
Or will this be another Vodaphone fiasco?
They didn't run up a tax bill per se.
They used a mechanism to pay the high end staff via Employment Benefit Trusts that was not the intended use of these instruments.
The HMRC uncovered this and changed the rules - also allowing for an amnesty if those who had abused the system 'volunteered' to make good. This was early 2010 I think.
The scope of misuse at Rangers is now clear to see.
14 February 2012, 01:07 PM
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The owner should go after the previous owner as who would buy a co. with such large unknown liabilities. Hidden off balance sheet finance naughty naughty.
14 February 2012, 07:18 PM
#30
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Christ on a bike 
Maybe I should clarify a few things
Rangers will not be the first club to fall foul of the changes to the EBT rules. Changes, incidentally, that were brought about by the Inland Revenue when it realised there was a loophole.
Expect HMRC to hunt down some of the large English premiership clubs who also exploited the loophole too.
The reason for using EBTs were that the wage demands of top players, brought about by greed from players and their agents, and effectively encouraged by top clubs across the world made it a very attractive proposition.
Why would you not use something that was legal at the time?
The vast majority of the debt has not been funded by the taxpayer, nor will the taxpayer have to pay for it in the event the Club is sold or exits administration via a CVA (Company Voluntary Arrangement) having reached a compromise with all of its unsecured creditors. Creditors including HMRC, which is unquestionably the largest in value, if not, to all intents and purposes the only unsecured creditor here.
But here's the thing. HMRC's options here are a) to agree to a compromise of pence in the £ and sign up to a CVA, or b) get nothing if the club is sold out of Admnistration or simply ceases to exist.
Hardly a complicated decision for HMRC to make - although there's no guarantee the'yle make the right one.
The issue now is the negotiation between the Administrators and HMRC. Just how much, or more correctly, how little, will HMRC accept. Administration has cost the Club 10 points. But it has also made it abundantly clear to HMRC that they have to be sensible in their negotiations or risk getting nothing at all.
Maybe I should clarify a few things
Rangers will not be the first club to fall foul of the changes to the EBT rules. Changes, incidentally, that were brought about by the Inland Revenue when it realised there was a loophole.
Expect HMRC to hunt down some of the large English premiership clubs who also exploited the loophole too.
The reason for using EBTs were that the wage demands of top players, brought about by greed from players and their agents, and effectively encouraged by top clubs across the world made it a very attractive proposition.
Why would you not use something that was legal at the time?
The vast majority of the debt has not been funded by the taxpayer, nor will the taxpayer have to pay for it in the event the Club is sold or exits administration via a CVA (Company Voluntary Arrangement) having reached a compromise with all of its unsecured creditors. Creditors including HMRC, which is unquestionably the largest in value, if not, to all intents and purposes the only unsecured creditor here.
But here's the thing. HMRC's options here are a) to agree to a compromise of pence in the £ and sign up to a CVA, or b) get nothing if the club is sold out of Admnistration or simply ceases to exist.
Hardly a complicated decision for HMRC to make - although there's no guarantee the'yle make the right one.
The issue now is the negotiation between the Administrators and HMRC. Just how much, or more correctly, how little, will HMRC accept. Administration has cost the Club 10 points. But it has also made it abundantly clear to HMRC that they have to be sensible in their negotiations or risk getting nothing at all.
Last edited by Devildog; 14 February 2012 at 07:21 PM.
