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15 Dec 2011
HM REVENUE & CUSTOMS could receive its answer sooner rather than later on whether a controversial insolvency rule in football is unlawful.
The taxman is battling against the football league over its controversial Football Creditor Rule (FCR) which prioritises some creditors over others.
Further reading
The court battle between HMRC and the Football League began at the end of November and it was thought a judgement would be given early next year.
However, presiding judge Mr Justice David Richards indicated he would like to deliver a judgement before the Christmas break.
The FCR prioritises the payment of football creditors such as other clubs and players ahead of other creditors, which HMRC believes is unlawful and outside the rules of insolvency - that all creditors should be treated equally.
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Visitor comments Add your comment
Football insolvency judgement
As an FCCA and a football supporter who is addicted to anything about Football Finance, who was brought up on the principles that the rules of insolvency were 1. Employees 2. Government Departments 3. All other creditors, I wonder what has happened to these rules.
Unfortunately what has happened within football in the past 30 years is that payments to those employees (players) have been the root cause of the spate of administrations, even though the players themselves are not directly responsible for what they are being paid.
I have to agree with the stance taken by the Inland Revenue in that it has an ethical base. In 2009-2010, Southend United for example, almost went into administration because it had overdue sums payable to the Inland Revenue. If clubs are not paying over the PAYE for deductions made, what then happens to a player's state pension on retirement? The clubs are not only cheating the taxman, they are ultimately also cheating the players.
Posted by: Laurence Hoppen F.C.C.A., 05 Jan 2012 | 13:54