HM Revenue and Customs (HMRC) has won its fight against Rangers Football Club over the club's use of Employee Benefit Trusts (EBTs) after the Supreme Court ruled in its favour.
Over £47 million was paid to players, managers and directors in tax-free loans between 2001 and 2010, but HMRC argued the loans were in effect player and staff wages, and so liable to income tax and national insurance.
According to the BBC, the Supreme Court’s decision is not expected to have any impact on Rangers at the moment, with the tax debt added to the millions left behind by the old club company, now known as RFC 2012.
The ruling is a big victory for HMRC in its bid to recoup tax from several other firms which ran EBTs and other similar schemes and were the subject of a crackdown in legislation in December 2010.
The BBC said HMRC could now issue ‘follower notices’ to demand payment from other companies who ran similar schemes, with a number of football clubs in England falling into this category.
The Supreme Court result adds to the gloom at Rangers after it suffered defeat in the first qualifying round of the Europa League last night, losing 2-0 to part-time Luxembourg side Progres Niederkorn, who finished fourth in the Luxembourg National Division last season.