Wales

Llanelli AFC wound up at High Court over tax debts

football

Former Welsh Premier champions Llanelli AFC have been wound up at London's High Court over a £21,000 tax debt.

Lawyers for the club, which formed in 1896 and was a founder member of the league in 1992, said the debt's size had been disputed since last August.

But Her Majesty's Revenue and Customs (HMRC) said no attempt was made to pay £3,000, which was undisputed.

Llanelli finished 11th in the league and had fended off three winding up attempts in the last six months.

However the financially troubled club had also been denied a domestic licence to compete in the league next season.

During Monday's hearing, Registrar Christine Derrett made the compulsory order which had been sought by the taxman, formally winding the club up.

Ruling that the club had failed to provide payment in full or seek liquidation since a hearing last month, she said: "I am sorry, it seems to me it was made perfectly clear exactly what was expected and I am not satisfied that steps have been taken as required.

"I am going to make the usual compulsory order."

The club's lawyers for the club said the £21,000 debt had always been disputed since the club turned amateur last August, meaning that the players had not been paid since that date and so no PAYE was due.

But Matt Smith, representing HMRC, said that £3,000 of the debt related to VAT which would be unaffected by that move, and no attempt had been made to pay the undisputed sum.

'Willing to pay'

The club's lawyers said they would be willing to pay it but the registrar decided it was too late and made the order.

The ruling effectively hands over the club's affairs to an official receiver who will ensure that debts are paid off by selling any assets available before closing the business.

At the previous hearing, the court was told that a club director had paid £3,000 and that it was considering whether a Creditors Voluntary Liquidation (CVL) or Creditors Voluntary Arrangement (CVA) was necessary.

The registrar then allowed a 28-day adjournment to pay the debt in full or to allow a CVL or a CVA to take place.

Two previous winding up petitions brought against the club by HMRC were dismissed in September and November last year.

Another Welsh Premier team, Neath FC, was wound up in May last year.

Also in May last year Neath Rugby Club was before the winding up court but escaped a winding up order after it was accepted it had paid its debts to HMRC.

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