Three Shakes … and a Twist


I do not know when the news will be released …

Comment on Three Shakes … and a Twist by rangerstaxcase.

I do not know when the news will be released publicly, and I do not know the exact outcome yet either. However, this is unfolding as we would expect. The amount that went through EBTs for MIH companies (obviously excluding Rangers) is just about £11m. This includes over £6m for David Murray himself.

The MIH exposure is obviously not huge then. The next biggest beneficiary who is not a Rangers employee received less than £800k.

The company (various subsidiaries) will be responsible for paying the tax bills in the first instance. As MIH is still going, it will be Lloyds that will effectively pick up most of the MIH bill.
As Rangers have no means of covering bills, it is quite possible for HMRC to go after individuals- including players.

If MIH have a significant liability it will be clear that the panel agrees with HMRC that the entire Murray usage of the scheme was a sham. By this I mean that a significant MIH bill would mean that the panel was not requiring evidence of a contractual basis on an individual transaction basis. Under these conditions, Rangers’ bill would be large. Very large. Of course, we do not know this to be the case yet.

The other biggest factor in determining the bill is whether the FTT contributions are considered net of tax or gross of tax. To explain in detail, Rangers contributed about £49m to staff through EBTs. If this is considered before tax, then the bill would be at most £24.5m (before interest). If considered after tax, the bill would be as high as £49m (before interest).

Justice would require a bill approaching £49m as this was the economic benefit obtained from using the scheme. (If they had paid tax, they would have had to find an extra £49m). However, on some legal technicalities, it is quite possible (even likely) that the payments will be ruled to be pre-tax i.e. we just take roughly half of the amount as the tax bill.

Interest is likely to roughly double the amount of the underpayment. So we can expect to see bills of anywhere from £16-49m plus that again in interest. Any result in this range would be conclusive proof that Rangers were engaged in cheating on a huge scale.

rangerstaxcase Also Commented

Three Shakes … and a Twist
I should clarify the above post- that it is not normally necessary to have proof of every transaction being contractual in nature. If the weight of the evidence builds, then entire usage of a scheme by a company can be deemed to be a sham and all transactions held to be taxable. Will that happen here? I think there is a very good chance it will.

Recent Comments by rangerstaxcase

Everything Has Changed
Auldheid (@Auldheid) says:
Sunday, February 17, 2013 at 21:42
For what it is worth, I think you have the UEFA qualification for Sevco nailed down. I agree with you entirely.

Everything Has Changed
bartinmain says:
Sunday, February 17, 2013 at 16:11
0 0 Rate This
Next Accounts Due: 28/02/2014

So, considering the season will be half way through by 28/02/16, it will actually be 2017 before they can play Euro football.

Last time I checked both UEFA and SFA rules for getting a UEFA license, I recall that there was no absolute requirement for 3 years of audited accounts- rather it requires 3 years of membership of the association. See below:

“Article 12 – Definition of licence applicant

2 The membership and the contractual relationship (if any) must have lasted – at
the start of the licence season – for at least three consecutive years. Any
alteration to the club’s legal form or company structure (including, for example,
changing its headquarters, name or club colours, or transferring stakeholdings
between different clubs) during this period in order to facilitate its qualification on
sporting merit and/or its receipt of a licence to the detriment of the integrity of a
competition is deemed as an interruption of membership or contractual
relationship (if any) within the meaning of this provision.”

Click to access 1500912_DOWNLOAD.pdf

Of course, this still raises some issues. Does “associate” membership qualify for the 3 year membership period?
Interesting definition on continuity of membership as well. 😉

Everything Has Changed
Sorry should be TM-01.

Everything Has Changed
Here is a copy of the TR-01

Everything Has Changed
Hello all. I read of some fussing about Companies House showing a mortgage charge over Sevco. As mentioned by others above, this is just the Scottish Sports Council’s charge on Murray Park and does not have any practical financial implications- and does not mean that Sevco have external debt.

However I also noticed on a T01 form, that Malcolm Murray was terminated as a director back on 18th December. Is that old news and it just didn’t create much fuss or is this new information?

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