Danny McCance 2 May 2017 12:43pm

HMRC to widen football tax probe

The Revenue will visit all English Premier League, championship and Scottish Premier League clubs over a three-year period

HMRC has created a new compliance project to pursue those within the football industry it believes are guilty of tax avoidance.

Last week it staged dawn raids at Newcastle United and West Ham United and in France over suspected income tax and National Insurance fraud.

Around 180 officers were involved in raids in Britain and France and made “several arrests”.

Now the investigation is set to include the entire British football industry.

“It [has] long been the concern of many as to how one is able to properly understand and control the flow of funds in the game [of football]”, said Trevor Watkins, global head of sport at Pinsent Masons and former chairman of AFC Bournemouth said.

Further details regarding the ongoing HMRC investigation have also come to light.

The Guardian has reported that the probe is linked to the transfer of players Moussa Sissoko, Papiss Cissé, Demba Ba and Sylvain Marveaux to Newcastle United.

The investigation is over whether £5m in income tax and National Insurance has been fraudulently evaded. The sums are thought to be in relation to payments to agents.

“I would think it’s down to an agent to be honest," Watkins said.

“It’s a bizarre situation where a player's agent can actually represent the club [that] is selling and the club [that] is buying in the same deal… It is an issue that football has found very difficult to grapple with”, he added.

“I think that the interesting thing here is that it concerns apparent onshore/offshore transactions.

“It would appear that this ingredient increases the potential for tax not to be paid”, he continued.

“The suspicion is when there is money that should have been paid to an employee in the UK, where income tax has been made or, as a consequence, National Insurance hasn’t been paid, there are significant sums that have been ‘diverted’.

“It would appear that unwittingly those who made the payments could be caught up in this without realising”, Watkins added.

On Sunday West Ham United was also forced to deny a story that a £1m payment to player Dmitri Payet was linked to the investigation.

“Dimitri Payet had a £1m annual loyalty payment, which was detailed in his contract submitted to the Premier League and The FA”, the press release from the club read.

“Payment was made via his normal monthly pay and subject to 45% income tax and National Insurance, which was deducted at source and was paid to his UK bank account along with his normal monthly wages.

“There is nothing to probe about this payment”, the club confirmed.

It added, “In contrast to many Premier League clubs, not a single West Ham United player has any part of his salary paid as image rights.”

Payet transferred from French football club Marseilles in June 2017. He returned to Marseilles in January this year, despite being paid the £1m loyalty payment by West Ham in September 2016.