Rangers tax case verdict as it happened

Reaction to the Rangers tax case decision, which has found that a loan scheme to reward some players and staff over nearly a decade was not in breach of tax law.

20 November 2012 Last updated at 18:11 GMT

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As it happened

  1. 1605: 

    Welcome to live reaction to the decision about the former Rangers Football Club have won an appeal against a tax bill over its use of Employee Benefit Trusts.

  2. 1610: 

    Here's a link to the news story on the BBC website...Rangers wins Big Tax Case appeal

  3. 1611: 

    The club, which is now in liquidation, used the scheme from 2001 to 2010 to make £47.65m in payments to players and staff in the form of tax-free loans.

  4. 1613: 
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  5. 1617: 

    This has been a subject of much heated debate for months, even before the old Rangers went into administration. Even when the judgement came out there were conflicting opinions about what the judgement from the First Tier Tax Tribunal actually meant. If you want to fathom your way through it yourself, have a go here...http://www.financeandtaxtribunals.gov.uk/judgmentfiles/j6851/TC02372.pdf

  6. 1617: 
    HMRC on Rangers tax case

    "We are disappointed that we have lost this stage of the court process and we are considering an appeal.

    "The decision was not unanimous and the diligence of HMRC investigators was acknowledged by the whole tribunal.

    "HMRC is committed to tackling avoidance and it is right that we challenge the type of avoidance seen in this case."

  7.  

    Yes, it is not all over yet. The fallout from this will not probably lead to an appeal by Her Majesty's Revenue and Customs but will now be examined by the Scottish Premier League, the Scottish Football Association and former employees, directors and players of the club.

  8. 1621: 
    Murray International Holdings, former majority shareholders in the oldco Rangers

    "We are satisfied that the Tax Tribunal has now published its widely awaited decision and note the contents thereof.

    "We are pleased with the judgement, which leaves minimal tax liability and overwhelmingly supports the views collectively and consistently held by our advisers, legal counsel and MIH itself.

    "This has been an exceptionally long, difficult and expensive process involving not just the Tax Tribunal but also significant efforts to resolve the matter with senior HMRC officials on a commercially sensible basis for all parties.

    "We will therefore review the detailed content of the decision with our advisers and legal counsel to ascertain what action, if any, is now required by MIH."

    More to follow.

  9. 1623: 
    Murray International Holdings, former majority shareholders in the oldco Rangers

    "While MIH has at all times respected the privacy of the Tax Tribunal proceedings, a substantial quantity of confidential information relating to the case has become available for public consumption, stimulating considerable discussion and often ill-informed debate.

    "This has been wholly inappropriate and outwith the fundamental principles of natural justice.

    "We therefore formally request that the relevant authorities investigate how these sensitive details have been released so widely.

    "We have instructed our lawyers to retrospectively review online and printed publications relating to the case to identify whether legal redress is either appropriate or necessary."

  10. 1624: 

    Stuart in Dundee on text: "So what happens now? Are oldco not insolvent since these loans are recoverable?!? Does this mean the sale and newco can/will be reversed by BDO?"

  11. 1628: 

    In answer to Stuart below, and to those who are wondering what it has to do with the British Darts Organisation, BDO are the liquidators - the people now in charge of the oldco Rangers after Duff and Phelps had handled the administration process.

  12. 1634: 

    Just to remind you of the background. The old Rangers was under the control of Sir David Murray when it began using Employee Benefit Trusts. He sold the club for £1 to fellow Scottish businessman Craig Whyte in 2011, at a time when the tax liability was in dispute. The FTT, before a judge, concluded in February, the same month as the old Rangers, now under the control of Whyte, was forced into administration by HMRC over non-payment of tax totalling about £14m. HMRC subsequently rejected proposals for a creditors agreement that would have allowed the old club to continue. Administrator Duff and Phelps then negotiated a sale of assets to a consortium led by Charles Green for £5.5m. His Sevco group has since formed a new club, now playing in the Scottish Football League Third Division.

  13. 1637: 

    HM Revenue and Customs had challenged the EBT payments, arguing that they were illegal. Rangers disputed the bill and a First Tier Tax Tribunal has ruled the payments were loans that can be repaid. The ruling was endorsed by two judges but one dissented.

  14. 1642: 

    This was all part of an effort by HMRC to crack down on tax evasion. It also matters to fans of Rangers and their fans because it could mean that Rangers might lose some of the silverware they won between 2001 and 2010. The Scottish Premier League has formed its own, independent, three-man tribunal to investigate.

  15. 1644: 

    The club was using the EBTs to make extra money available to players and staff. EBTs can be a legal way of allowing employees to borrow money tax free, which may not need to be paid back, but they must not be payment for work. They cannot be associated with a contract and must be at the discretion of the trustees running the trust.

  16. 1646: 

    Work by the BBC Scotland investigations team in Glasgow uncovered "side letters" sent to a number of people that, on the face of it, look like contracts that could have made their EBTs illegal. Here is a list of some of those who got money, indicating whether they got a side letter. http://www.bbc.co.uk/news/uk-scotland-glasgow-west-18148818

  17. 1652: 

    While these payments, according to the tribunal, are not illegal, the Scottish Premier League and Scottish FA must now decide whether they breached their footballing rules. All payments for playing have to be declared and, if these were payments for playing and were not declared, then they are against the SFA's rules. If Rangers are ruled to have made payments against SFA rules, the new Rangers will not be affected, but results of the oldco could be nullified and that might have an impact on competition outcomes.

  18. 1653: 

    Davie from Glasgow by test: "So, when BDO chase up these ex-players to pay their loans back, who will be first one to put spanners in work by saying it was their wages!" That is the big question. Will the SPL decide that they payments, while legal under tax law, breached SFA rules.

  19. 1656: 

    Andy in Fife by text: "Just because Rangers won the tax tribunal doesn't mean that they didn't break SPL rules on side contracts. Should still be stripped of titles as punishment. I expect HMRC will win this on appeal."

  20. 1657: 

    Stephen in Glasgow by text: "Great news for all the creditors who can now get paid when the ex-players repay the £46m that is now due." It is not only players but directors and other staff who could now be pursued for tax on these "loans".

  21. 1700: 

    Jim from Dunoon on text: "Can HMRC now justify spending public money to pursue an appeal against a liquidated company, or will they now admit they were making an example of Rangers?"

  22. 1701: 

    Brian Murray ‏@KillieMad @bbcsportsound: "Tax case result was always a football sideshow. We need to know if these payments were declared per SFA rules."

  23. 1704: 

    Martin from Hyndland: "How many of these fabled side letters will appear when the tax man appears at former players doors wanting paid? Interesting times ahead."

  24. 1706: 

    Pete in Aberdeen: "Paragraphs 161-163. ......There was a conscious decision to conceal the side letters existence that extended even to the club's auditors. Surely there is no way titles won't be stripped now."

  25. 1708: 

    Grant ‏@Moon_Heid @bbcsportsound: "Gers not guilty in big tax case means that payments were loans. Not payment for work/playing. This is legal under SFA rules"

  26. 1713: 

    Apparently SPL officials are digesting the finding of the report. It is not clear whether it will make a statement tonight.

  27. 1716: 

    Don't hold your breath about a statement from the Scottish FA tonight either. It appears that, at this stage, the parent body sees the question of Rangers' EBTs as an SPL matter. At least until such time as the SPL's own independent commission completes its own investigation and report.

  28. 1721: 

    Scott in Glasgow by text: "To the people who are expecting money now to be claimed back from the ex-players, this will not happen. Today's ruling does not state that they owe the money, but rather that the law dictated that the payments 'could' have been defined as loans and therefore did not breach the law at that time. Stop the witch hunting!"

  29. 1727: 

    Those who argue that Rangers should be stripped of titles will look to the evidence of Roderick Thomson QC, on behalf of HMRC. He told the tribunal that side letters had not been registered with the football authorities, the SFA and SPL - and that the spirit of the rules was that the whole contract terms should be registered.

  30. 1728: 

    Ian McLean by text: "The SFA and SPL have failed in their duty of care to a member club, subjected to asset stripping by an unscrupulous owner. The media hype that found Rangers guilty before today's BTC decision may well result in legal action against a number of individuals and organisations."

  31. 1731: 

    Should Rangers be found guilty of breaking SPL and SFA rules, the following could be under threat: SPL titles in 2003, 2005, 2009, 2010 and 2011, Scottish Cups in 2002, 2003, 2008 and 2009 and League Cups in 2002, 2003, 2005, 2008, 2010, 2011. To be fair, the Scottish Football League has stated that it has no plans to strip the club of League Cup wins.

  32. 1743: 

    It is also all quiet down Ibrox way. Today's ruling will, of course, have no effect on the Rangers now playing in Division Three - unless some former titles they stress that they have inherited are stripped from them by the football authorities. The current Rangers regime's chief executive, Charles Green, has also challenged the independence of the commission. So no statement from his regime about today's ruling.

  33. 1744: 

    Giovanni di Stefano @DEVILSADVOKAT: "The next step is for a shareholder to apply to court to reverse/revoke administration/liquidation...I wonder which shareholder will do that?" Is that an indication of intent from the former Dundee director who bought a share in Rangers as they headed for liquidation?

  34. 1747: 

    Giovanni di Stefano @DEVILSADVOKAT: "I will be writing an open letter to BDO/DP and Court of Sessions seeking as a shareholder of RFC PLC a revocation of admin/liquidation." Seems like it was! An interesting twist from the Italian businessman who failed in an attempt to buy Dundee Football Club.

  35. 1749: 

    DD from Dundee on text: "If the EBTs were loans, as Rangers appear to have argued, why did they not simply call up the loans and use the funds to pay their creditors?"

  36. 1754: 

    If you are still a bit confused about what all the fuss is about over EBT schemes, here is a wee guide...Q&A: EBT schemes explained

  37. 1755: 

    And, if you want to know how Rangers' big tax case reached the present stage, here is a blow-by-blow account...Timeline: Rangers Tax Case

  38. 1758: 

    So, to summarise, the former Rangers Football Club has won an appeal against a tax bill over its use of Employee Benefit Trusts. The club, which is now in liquidation, used the scheme from 2001 to 2010 to make £47.65m in payments to players and staff in the form of tax-free loans. HM Revenue and Customs had challenged the payments, arguing that they were illegal. Rangers disputed the bill and a First Tier Tax Tribunal has ruled the payments were loans that can be repaid.

  39. 1801: 

    The First Tier Tax Tribunal's ruling was endorsed by two judges, with one dissenting. Today's decision was welcomed by Murray International Holdings, who were majority shareholders of the old club until Craig Whyte's ill-fated takeover in May 2011. However, HMRC said it is considering an appeal. There has been no response as yet from the Scottish Premier League, the Scottish Football Association, or from the present Ibrox regime.

  40. 1806: 

    The possible appeal from HMRC is not the only matter that will ensure that this story will drag on. The Scottish Premier League's own investigation into Rangers' EBT scheme has yet to conclude its own findings. Some argue that today's decision makes it more likely that the commission will rule against Rangers - because of suggestions there were side letters undisclosed to the authorities. Others suggest that Rangers are now in the clear because the tribunal ruled that the EBT scheme was not illegal. We'll keep you up to date with further developments. Watch this space...

  41. 1806: 

    Meanwhile, tune in to BBC Radio Scotland MW for more on this and other football news on Sportsound, starting in a couple of minutes.

  42. 1807: 

    And don't forget we will have live text coverage of Celtic's Champions League match against Benfica, starting after 7pm. For those wanting to know the latest from the other group game in Russia, Barcelona are 3-0 ahead against Spartak Moscow. Unless Spartak stage a major comeback, that means Celtic will go through to the next round with a score draw in Portugal. Hope we see you later and thanks for your company on another historic day in Scottish football.

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