BusinessBusiness RecoveryBreaking news: HMRC to veto Portsmouth CVA

Breaking news: HMRC to veto Portsmouth CVA

HMRC source says it doesn't regard 20p in the pound as "an acceptable return to the taxpayer"

The taxman is set to reject Portsmouth Football Club’s plans to save itself
from collapse, as it regards the troubled club’s offer of 20p in the pound
return to creditors as too low.

“[Portsmouth Football Club] have offered 20p in the pound to creditors, which
we don’t regard as an acceptable return to the taxpayer,” an HMRC source told
Accountancy Age.

Portsmouth is hoping to hammer out a Company Voluntary Arrangement (CVA),
giving the South Coast outfit the ability to carry on as a football club – with
a creditor meeting scheduled for next week.

The club needs 75%, or more, of creditors to vote in favour of the CVA for it
to be approved.

Because of the amount of money owed to the taxman, the agency holds 25% of
the vote.

“We are determined to achieve a decent return to the taxpayer,” the source
added.
HMRC had previously changed the first draft of a CVA as it wanted the proposal
to include a liquidation in order to investigate antecedent activities.

Accountancy Age revealed earlier this month that HMRC filed a writ
against the Premier League regarding its controversial “football creditors rule
“.

The FCR essentially means all football creditors, including players and
managers will be paid in administrations, with the money usually deducted from
payments received through TV rights.

Further reading:

HMRC
tackles Premier League football creditor rule

Portsmouth
CVA shakes up FC insolvency rules

Portsmouth
FC heading for groundbreaking deal

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