Raymond Doherty 14 Nov 2019 01:14pm

HMRC made £50m mistake on Rangers, reports say

It is claimed that the tax bill from HMRC to Rangers football club was significantly miscalculated

According to a report in the Times today, the £70m that the Revenue claimed from the club over Employee Benefit Trust (EBT) payments should have been closer to £20m.

The £70m bill was central to the club’s liquidation in 2012 and forced it to relaunch at the bottom of Scottish football.

In response to the reports, former Rangers chairman John McClelland told the Times, "At the time of the sale of the club in 2011 had the tax claim been at the level now being reported then, in my opinion, the outcome would have been different. I believe there would certainly have been a much higher level of interest in acquiring it and therefore more potential buyers.”

An HMRC spokesman said, ”We don't comment on identifiable businesses. HMRC has always been clear that disguised remuneration is a form of tax avoidance."

In 2017 the Supreme Court ruled in favour of the Revenue in its long-running legal battle with the Scottish football club.

The case centred on payments made by the club to players and officials through an EBT – named the Remuneration Trust – in the form of a loan, which allowed the club to avoid liability to income tax and National Insurance Contributions (NICs).

The decision that the loans should be counted as payments and thus the club had failed to pay the NICs and income contributions due through PAYE was made in the First-Tier Tribunal in October 2012. The decision was upheld in the Upper Tribunal in July 2014.