via The Guardian |
Rangers’ oldco liquidators have asked for leave to appeal the long standing Ibrox ‘Big Tax Case’ – as it has become known – to the Supreme Court in London, as exclusively revealed by Telegraph Sport.
If leave to appeal is granted by the Court of Session in Edinburgh, the debate about the propriety of 15 honours won by Rangers between 2001 and 2011 will be shelved for at least another year. The issue concerns Rangers’ use of EBTs (Employment Benefit Trusts) during that period to enhance the contracts of players and other employees.
HMRC has been vexed by the avoidance ploy for 15 years and brought in legislation in respect of disguised remuneration in 2011 to close the loopholes which the creators of EBT schemes had attempted to exploit to reduce the tax burden on their clients. BDO, representing the Rangers oldco which was liquidated in the summer of 2012, won the first two lower tribunal hearings which adjudicated on HMRC’s claim.
However, the tax authority at last achieved a favourable return from the Court of Session earlier this month, when Lord Carloway, sitting with Lord Menzies and Lord Drummond Young, ruled that if income was derived from employees’ services, in their capacity as employees, it was an emolument or earnings and, in the words of the judgment, “thus assessable to income tax”.
Lord Drummond Young made the observation that if EBTs had not been in operation at Ibrox certain players “might well have taken their services elsewhere”, a remark that fuelled renewed clamour amongst supporters of rival clubs to have Rangers stripped of the five Scottish championships, four Scottish Cup successes and six Scottish League Cup triumphs achieved while the avoidance scheme was in operation.
However, it is believed that one argument against the supposition that Rangers secured players by means of EVTs is that a range of variable inducements were in operation at that time and not only at Ibrox. Other avoidance schemes involved investment in such vehicles as film production companies and forestry development.
Last week the former Dutch international midfielder, Ronald de Boer – now manager of Ajax – said of his decision to move to Ibrox in 2000: “At that time, I could also have gone to Manchester United but I chose Rangers.
“That was with my heart and not only for the money. I played with all my heart for Rangers. It was the same (money at United) but I was afraid for my knee at that time and Rangers gave me a four-year deal whereas United gave me three years.”
Lord Drummond Young also remarked that the Court of Session ruling accorded with “common sense”. It is thought that this observation will be disputed in the appeal to the Supreme Court if leave is granted to take the case to the next level.
Telegraph Sport also understands that opinion amongst London legal experts holds that BDO has a strong chance of having the Court of Session verdict overturned should the matter be heard for a fourth time and that it was a certainty that the liquidators would appeal from the moment the Edinburgh decision was published.
A statement from BDO today said: “Following discussions with the company’s legal advisers and the liquidation committee, the joint liquidators have filed an application seeking leave to appeal the Inner House of the Court of Session decision in respect of the EBT case.
“If the company successfully obtains leave to appeal, the appeal will be heard in the Supreme Court in London. The joint liquidators are not in a position at this stage to make any further comment in respect of the appeal.”
It was Telegraph Sport which first revealed that several Premier League clubs in England, including Arsenal, had agreed settlements with HMRC in respect of EBT and other tax avoidance schemes.
Celtic are the only club in Scotland, apart from Rangers, who are known to have used an EBT contract. They did so for Juninho, who played for the Parkhead side in 2004-05, and who received his cash after he left the club, unlike those at Ibrox who were beneficiaries while still playing there.
Meanwhile, following another Telegraph Sport exclusive the bookmakers installed Mark Warburton as favourite to end Fulham’s long search for a successor to Kit Symons.
The Rangers manager, however, distanced himself from the Craven Cottage club’s latest move. “It’s very flattering. It’s always good to be linked.
“There are lots of times in your life when you’re not linked to jobs, that’s for sure. All you can do is put your head down and do your job here. The amount of clubs who change their managers down south is increasing year on year.
“I’m the Rangers manager. It’s a huge club here. There’s some big clubs in the English Championship – there’s no doubt about that – but this is a huge club.”