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HMRC to appeal Rangers case

In the latest development of HMRC’s dispute with Rangers over the club’s use of Employee Benefit Trusts (EBTs), HMRC has lodged an appeal against the First Tier Tax Tribunal decision.  You may recall that HMRC had claimed PAYE on the sums, over £40 million, paid to players and staff in the form of tax-free loans.  At the last hearing, a majority of the judges concluded that the EBT payments were loans, not earnings, and therefore not liable for income tax.

HMRC has now been granted leave to appeal against this decision and the case will be heard at the Upper Tier Tax Tribunal.

By way of further background, Rangers ‘old company’ went into administration in February 2012, after action from HMRC over non-payment of tax totalling about £14 million arising primarily from the loan arrangements. The club’s administrators then negotiated a sale of assets for £5.5 million.  According to the Rangers website HMRC has confirmed that no tax liabilities transfer across to the new company. There is, therefore, no money to be gained by HMRC as the old company has been liquidated.  There seems to be some surprise that HMRC is continuing to pursue the matter further if there is no financial recompense available.



Date: 20th February, 2013
Author: Cathy Corns


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