Rangers

[Wolf Hunting]

Am I right in thinking that this then leaves the Revenue out of pocket by around £60-70 Mill?

 

[Deutsch Wolf]

Am I right in thinking that this then leaves the Revenue out of pocket by around £60-70 Mill?

Depends what proportion of Rangers' debt is owed to HMRC (and, of course, supposing the verdict goes against the club). If 25.1% or more of Rangers' liabilities are owed to the taxman then they can block any proposed CVA.

 

[Paddingtonwolf]

The revenue claim Rangers owe them something like £49 million so I would wager the percentage is sufficient.

 

[Deutsch Wolf]

Do remember though that in the last couple of years, HMRC have failed to put away Portsmouth FC, Storrie, Mandaric and Redknapp. They don't seem to have the world's greatest legal team.

Also remember Andronikou's dealings at Pompey where tens of millions of previously undiscovered debt was uncovered as the administration process went on. Some of which came as news to the supposed creditors as they were unaware they were owed anything, but all brought HMRC's percentage down below 25%. Which is obviously well dodgy, in fact illegal to falsify the figures, but again, nothing happened.

The difference here I suppose being that from a cashflow point of view Rangers aren't in that much of a mess, it's the debt to HMRC which is the issue. Pompey did have issues with the taxman but equally they couldn't service ongoing liabilities and hence more unsecured credit built up. Rangers aren't having problems with paying electric bills, or their website provider or anything.

 

[Donegal Wolf]

The revenue claim Rangers owe them something like £49 million so I would wager the percentage is sufficient.

There chairman said last night it was greater then £49million, more like £60million plus but they were still working on the figures!

 

[Deutsch Wolf]

Oh, and one more thing (insert your own Columbo joke here):

Rangers haven't had an issue with paying their staff, as yet, or transfer fees to other clubs. Hence there is very little secured debt within the football industry, whereas that accounted for millions and millions of pounds at Fratton Park.

 

[Paddingtonwolf]

The simple problem with Rangers is that they dispute they owe it. The aren't in financial meltdown, but if this went against them they would be utterly potless. White is a shrewd fucker, and if binning off the title for one season makes the problem go away everyone is a winner on that side of glasgow.

 

[Deutsch Wolf]

Whyte's shrewd, but not in a good way. His background is very, very shady, he did the Allardyce thing of threatening legal action against the BBC and then did erm, nothing, he's refused to publish accounts, he's lied about mortgaging off season ticket money and lied about how he financed the purchase of the club.

The problem goes a lot deeper than losing the league this season (they probably weren't going to win it anyway). Whyte himself can't afford to pay HMRC if they're found guilty and the debt would far exceed the assets of the club, even allowing for them owning Ibrox and Murray Park as it stands. Playing assets are negligible and unless they come out of administration within about four weeks they won't be able to get a UEFA Licence for next season which means again no European football and the same shortfall in income which has harmed them this year.

Hence liquidation is very much a concern.

 

[Paddingtonwolf]

I think he expects to win the case. Basically Employee Benefits Trusts were a perfectly legal way of avoiding significant tax for high earners. I used them for share schemes for years with the idea that the money sits in the EBT for a set period and then is effectively income tax free - you end up paying CGT on the gains made, which for a higher rate (or 50% rate as it would be with a lot of footballers now) payer is a significant saving. When a lot of the EBT stuff was dealt with the change was made retrospective, suddenly meaning that employers who had been acting legally (at the time) were looking at hefty bills. The fairness of that move is what I expect Rangers to challenge, and I would imagine a lot of other companies will view proceedings with great interest.

 

[Deutsch Wolf]

You're quite right - it's as much a test case as anything else. Which is why HMRC have resolutely refused to discuss a payment scale or settlement on the monies owed, because in itself, as far as the government is concerned, they're a drop in the ocean. However should they win then lots of other companies will be fair game as precedent will have been set.

Even if Rangers do win then they are in big, big trouble with all season ticket money out of the equation for four years (they've been advanced £24m for it), merchandising rights outsourced on a similar basis, an owner who has very limited wealth of his own, a poor reputation with banks due to past misdeeds/current economic circumstances, dwindling SPL TV money (which will only go down if it becomes a procession with Celtic winning it easily every year), no playing assets of any note to sell and it being an almost certainty that they won't be in Europe next year - estimated to have cost them £20m this season. However they would be unlikely to be liquidated under those circumstances, they'd possibly be set for a second spell in administration which would have its own consequences, but the club would probably still exist in its current format.

 

[Wolf Hunting]

There we go Rangers are in administration! Obviously bad for them but thats the league won for us. Time to celebrate haha

I'm sorry to point this out, but Rangers having been docked 10 points have dropped from 2nd to.... er 2nd!
And are now only 9 points above Motherwell in 3rd place.

I think winning the Scottish Premier league is about as meaningful as the American Baseball series euphemistically called the World Series, has no one playing in but American teams. There's only two teams in it and now, there's only one. Celebrate as much as you like...

It seems like the SPL is a bit like having a wank... seems like a good idea at the time, but immediately afterwards, you wonder why you fucking well bothered.

(Not sure, but I think I might just have alienated 3 or 4 different groups of people with that one.)

 

[CelticBhoy]

I'm sorry to point this out, but Rangers having been docked 10 points have dropped from 2nd to.... er 2nd!
And are now only 9 points above Motherwell in 3rd place.

I think winning the Scottish Premier league is about as meaningful as the American Baseball series euphemistically called the World Series, has no one playing in but American teams. There's only two teams in it and now, there's only one. Celebrate as much as you like...

It seems like the SPL is a bit like having a $#@!... seems like a good idea at the time, but immediately afterwards, you wonder why you $#@!ing well bothered.

(Not sure, but I think I might just have alienated 3 or 4 different groups of people with that one.)

It is embarrassing for Scottish football that even with 10 points deducted they are 2nd with the closest being Motherwell 9 points behind, but you must see that we have not won the league in 3 seasons! Regardless of points being deducted I still believe we would have won the title this year. Take the Spanish League, Madrid 10 points ahead, do you think they will think the title is meaningless after Barca's recent domination? I don't think so. Winning any form of trophy is special if you are a fan of that club/competition so no I dont think "winning the Scottish Premier league is about as meaningful as the American Baseball series euphemistically called the World Series, has no one playing in but American teams."

 

[Paddingtonwolf]

I think Celtic would have won the title anyway, probably by 5 to 8 points. The issue is that the 10 points doesn't hurt Rangers because the Auld Firm are so far ahead. What will hurt is if they don't get their UEFA licence.

 

[Premier Quality]

Why on earth would you borrow the next 4 years season ticket money and then go into administration? That doesn't make sense to me?

 

[Paddingtonwolf]

Get the money in. Then get the bank accounts frozen with the cash already in them. At least it is yours and counts as an asset if the liquidation calcs are being done.

 

[Deutsch Wolf]

Depending what you read/believe, this money (£24m) is being used to pay off a loan that Whyte acquired to pay Lloyds off. He only paid £1 for the shares from Murray but the bank debt (circa £20m) needed wiping out or Lloyds were going to pull the plug. However Whyte did previously say that he'd funded this payment himself, which subsequently doesn't quite look like the whole truth...

 

[Deutsch Wolf]

Interesting...

HMRC weren't trying to force admin today because of the EBT issue and the upcoming case. Apparently Rangers are millions behind in *this* year's tax payments.

Suggesting that Whyte has had administration/liquidation as Plan A from day one. And which would fit with his business history.

 

[Wolf Hunting]

Heard tonight that Rangers owed ... (missed it with shite reception!) millions but that's a really old debt, but the £9 million owed on non payment of PAYE and VAT is on his watch and he will be responsible for...

If I've listened to my wife correctly, non payment of tax is one thing, but non payment of PAYE is entirely another...

I hope when he goes to court to defend not only that but explains why he didn't come up with the VAT, that he's wearing clean underpants, because he's really going to get his balls chewed.

 

[Deutsch Wolf]

Yes, he will, because it appears to be entirely deliberate. The EBT is a totally separate issue even though Rangers still owe the money to HMRC (if they're found guilty). However this is an outright failure to pay VAT on monies received and PAYE/NI contributions on staff wages.

I also heard a very strong rumour that no contractors working at Ibrox or for Rangers have been paid for six months.

 

[visage]

So, if I understand it right, Rangers were deducting tax from employees wages, but not then forwarding that to HMRC? Presumably pocketing it...

I cant imagine that going down well.....