The taxman has pulled out of its day in court against Leeds United next week over the controversial sale of the business back to Ken Bates, but says it intends to pursue what it is owed following the club's collapse.

HM Revenue & Customs said the court challenge, which revolved around legal costs relating to the sale of company via a CVA, was academic following the CVA's collapse.

'HMRC's challenge became academic when the administrators withdrew the CVA,' it said in a statement.

But the taxman was still working on looking to recoup what is believed to be about £8m in tax owed by the former Leeds company structure that collapsed.

'…We will continue to take all possible steps to secure an outcome which ensures that taxpayers receive a fair return on the debt owed to the crown,' it stated.

However, it is unclear whether HMRC will target former Leeds administrators KPMG or the owners of the football club.

KPMG said it had no comment on the matter, and Leeds was unavailable for immediate comment.

Further reading:

Leeds United enters League without a CVA