Rangers Tax Case
Rangers Tax Case – a former owner has accused HMRC of bringing a great football club, Glasgow Rangers, down via a spurious tax claim against them.
HMRC demanded more than £46m from Rangers after they used offshore Employee Benefit Trusts (EBTs). HMRC lost the Rangers tax case in a 2-1 verdict at a First Tier Tribunal in November 2012.
So, they decided to appeal it. The judge has now thrown that appeal out too.
EBTs for UK Contractors
HMRC said that Rangers were using EBTs to pay top players salaries. However, the tribunal and then the judge said that the money given to the players were loans.
Now, former owner, David Murray, said that the tax demand was instrumental in Glasgow Rangers being liquidated.
He said that the case hanging over the club caused the market to have a lower perception of the value of the club.
Bought by Craig White
Eventually Craig Whyte bought the club for just £1.
He would have to pay the debt of £18m to Lloyd’s Bank as part of the agreement. Unfortunately, he financed that out of future season ticket sales.
As a result of Rangers not making it into the group stages of the Champions League and Rangers season ticket income already being spent, they got into tax and VAT trouble. So, they went into administration and then liquidation.
Now David Murray wants the Government to start an enquiry over the Rangers Case and how HMRC acted. It seems that Rangers offered HMRC a substantial amount of money to settle the case but turned it down.
Rangers tax case and their defeat could have huge ramifications for HMRC. They were using Rangers as an example.
It’s estimated that there are 5000 other companies using this route, including a number of top English football clubs.
So, a win for HMRC in the Rangers Tax Case could have produced a huge windfall for HMRC.
However, defeat in the Rangers Case has now caused them a lot of trouble amongst football fans and club owners. There will be a backlash against HMRC.
Rangers Supporters Club
According to a Rangers Supporters Club the Rangers tax case has caused a lot of pain to Rangers. They said “Rangers Football Club and its fans have been the victims of a witch-hunt by HMRC. It has done tremendous damage to a proud Scottish institution.
“Why did HMRC continue with this spurious claim when they were offered settlement? We deserve answers as to why this was done to our club”.
It was revealed, last year, that HMRC had come to settlement with many major firms. They were panned for it.
Therefore, the Rangers tax affair could still up a whole can of worms for HMRC. Football fans are not to be trifled with.
For a list of Offshore Umbrella Companies for Contractors click on Offshore Umbrella Companies List
HMRC appealed the case again and won it. Now Rangers are going to appeal to the Supreme Court.