Lies, damned lies, and Scottish football journalism

Being privy to many of the facts related to Rangers’ tax ordeal, the last year has been a revelation to me.  I find it hard to believe that every journalist in Scotland is naive enough to believe the nonsense being fed to them.  In their hurry to publish, they shamelessly rush from fax machine (or whatever PR firms use these days) to the press without editing or critical thought.  In short, readers are paying to read PR-fluff written and produced by people with agendas.

Then there are a number of hacks who surely cannot claim, after all of these years, to have simply been hoodwinked by purveyors of succulent lamb?  Some Scottish journalists’ track record of doing the bidding of the country’s more media savvy businessmen goes back to a time where a simple loyalty to their favourite football team cannot explain everything.  This has the odour of  “bought and paid for” reporting.  A passionate and diehard Rangers fan could not go along with this fakery. Only the most naive or corrupt of journalists could continue to do the bidding of people whose interests are diametrically opposed to Scottish football as a whole, and most specifically, Rangers FC.  Yet Rangers fans are fed this diet of regurgitated lamb and foolishly lap it up like it is a kebab at closing time.  It seems that any bearers of bad news, regardless of allegiance, are dismissed as troublemakers (and worse).

That brings us to today’s topic.  We will take a quick look some of the myths and lies that our national media have helped weave into the popular debate on the subject of Rangers’ financial and legal woes.

We can see in the link below as fine of an example of journalistic creativity as you will ever find.  It is clear that even Graham Speirs- Scotland’s most erudite sports journalist- can resort to just filling his pages with a collection of random ‘facts’ with no relevance to the actual story:

Let’s put a few of these myths to rest:

Image Rights:  Absolutely nothing in the case against Rangers has anything to do with image rights.  The hacks must have just picked up some detritus from stories about  English clubs.  This is completely irrelevant to the matter at hand.

“The tax bill is a matter for MIH”:  Rangers’ Chairman, Alistair Johnston, started this myth with some artfully worded statements. It is pretty obvious that he was trying to be “economical with the truth”.   However, the Laptop Loyal took his inferences and fed them to the masses.  Today, a large number of Rangers fans still believe that the tax bill will be paid by the parent company, MIH.  Let me state without fear of contradiction, the tax assessments (bills) are addressed to: “The Rangers Football Club plc”.  Rangers FC are responsible for these bills.  If they cannot pay them, no one else is obligated to contribute: not MIH; not Lloyds Banking Group; and not Sir David Murray (more on this later).

“No one has been accused of doing anything illegal”: Yes they have.  Rangers FC have been accused of breaking UK tax law.  The First Tier Tribunal process is a civil matter, and there is no current criminal case against anyone.  However, that is at the discretion of HMRC and it will remain at the discretion of HMRC whether to bring criminal charges in the future.  In cases not involving lawyers or financial professionals, it is unusual to go down the criminal path as the burden of proof is much higher.  Depending on how things turn out, and how much of the bill is actually extracted from Rangers, it is not impossible that individuals could be pursued.  However, that would be quite some way down the road- if it ever happens at all.

Murray / Lloyds will guarantee the tax bill to facilitate the sale of Rangers”: Let me also give my opinion on the notion that someone will underwrite a tax bill which could be up to £60m.  It is absurd in the extreme and just laughably stupid.  As things stand, no one else has to pay this bill.  If Rangers cannot pay it, they will end up filing for insolvency.  The creditors, which would include Lloyds, HMRC, and holders of The Rangers Bond, would carve up the proceeds of a sale of the club.   If it does not cover all of the bills, then tough.  No one else pays.  (I will discuss some potential risks to the personal wealth of Sir David Murray and other directors in a future post).

By what financial alchemy can someone create a logical argument for Lloyds, MIH, or Murray accepting this liability?  Even if the numbers being touted for a Rangers sale were true (which I don’t believe for a second), £33m would be divided between bank debt (about £20m just now) and money for Murray (£13m). I am laughing as I type because the idea of anyone paying this price is hilarious!  It is not unusual in corporate transactions for sellers to provide guarantees of accounts receivable and tax liabilities.  However, these are made when there are no known issues or where the risk represents a tiny fraction of the total deal.  In Rangers’ case, the tax bill is almost the entire deal.

We are supposed to believe that Lloyds, who would probably recover the full value of their loans to Rangers through the administration process, would accept this risk and have nothing to gain?  We are supposed to swallow the idea that Murray would, even if he received the fabulous sum of £13m, run the risk  of having to pay £60m?

Murray might want to give away ‘his’ shares just now, but they are not his to give away.  85% of Rangers’ shares are held by MIH.  MIH is a vassal company for Murray.  Lloyds own MIH in everything but name.

So where are the members of the Fourth Estate to bring sanity to this madness?  Why has every Scottish media outlet: print; radio; and TV, lined up to give this story credibility?

No story about Rangers’ financial position is credible without a discussion of the tax case.  Until the tax case is resolved, the equity in Rangers FC is worth nothing.  Without the tax case, Rangers’ current financial position would be quite healthy.  All of the problems being blamed on bankers (with foreign sounding names) and “enemies within” really just begin and end with Rangers’ attempts to gain a financial advantage through a tax dodge.  Rangers’ fans could put their energies to better use planning for the worst case scenarios.  It would do all of Scottish football some good if they ensure that the individuals who brought their club to the brink do not duck the blame for their own incompetence and maladministration.

About rangerstaxcase
I have information on Rangers' tax case, and I will use this blog to provide the details of what Rangers FC have done, why it was illegal, and what the implications for what was (updated) one of the largest football clubs in Britain.

116 Responses to Lies, damned lies, and Scottish football journalism

  1. rasputin says:

    I can tell you that you will need a bigger shovel to fill in the hole you are digging. The “Tax Inquiry” involving Rangers FC, will be formally abandoned at the Edinburgh First Tier status, on 18th April 2011, do have a nice day.

  2. Annie M says:

    I think people give the Scottish media too much credit and intelligence.
    They are not wilfully covering up this story. They simply don’t get it, don’t understand it, and have no contacts willing or able to assist their tiny minds with the complexities of the subject.

  3. Ciarans Dad says:

    How can they sell for £33m when the value on MIH books is more than double this. Also if MIH gave it away would the resultant write down not cause MIH to go into administration?
    Just seems the Laptop Loyal seem to miss this point and that’s before a realistic value is put on ipox

  4. You do realise that this hearing is a continuation of the process that started in October last year? That it is being held in April-May now (scheduled for 3 weeks) because the first part of the process over ran its alloted 2 week schedule?
    With such great sources of information (which was already available on FF) you will no doubt know that Rangers have still to complete their presentation of evidence in their appeal and that HMRC has not even began its presentation of evidence against Rangers? Being “in the know”, you will also be aware that the reason for so much panic within Rangers FC since the October phase ended was the way Rangers’ witnesses were chewed up under cross examination and made a number of very damaging admissions? Looking forward to your replies in early May. We can compare notes.

  5. cadizzy says:

    It is good to read someone pushing back on the lazy acceptance by journalists of the spin coming out of Ibrox.

    I read your article from yesterday concerning the tax case in detail and I agree with all that you say. I have myself been banging on for a while now that, in order to get an EBT arrangement wrong, an employer has to get the basics wrong; in this case, Rangers have surely attempted to recharacterise contractual amounts as discretionary amounts given that football remuneration is all about contractual payment. Even bonuses are based on a formulaic approach (e.g. if we win 3 points, you will get £x) so even those are difficult to shoehorn into an EBT.

    I suspect that there will be “salary sacrifice” documentation demonstrating that all of those players were quite happy to enter into a contract that paid less than the going rate in return for absolutely nothing other than the recognition that if the employer saw fit, he might make a contribution into a Jersey based employee benefits trust with this in turn being dropped into a family benefits trust in relation to each particular player. Aye right! I suspect also that there is a collection of side letters in each and every case , probably hidden below the marble staircase, giving comfort to each player that they will not lose out.

    It would also be interesting to know if any of those players were tax protected (on a net pay basis). Not only does that throw a huge big question mark over the sanity of any player who enters the arrangement, it also increases the PAYE failure significantly, since there would then be a requirement to gross up.

    Of course, players on a net basis may be given that net basis in return for their agreement to participate in the EBT arrangement; however, that mutuality of obligation smells very contractual to me and no doubt to HMRC also. There would be no commercial rationale; the only reason for the arrangement is to avoid tax. QED, RFC, RIP

    The whole problem for Rangers and other clubs is that they are trying to take a model from another industry (financial services) that doesn’t suit the custom and practice of the football industry. It is not even the main issue that loans or benefits in kind can come out of the trust tax free (in any year after the employment is ended) though that does enrage HMRC just a tad, Rangers quite simply seem to have fallen at the first hurdle. As indicated, trying to shoehorn one’s own circumstances into those that apply elsewhere and which are contrary to the custom and practice in one’s own area is the very first mistake…in this case, possibly the fatal one. I may not be invited to the funeral but I’m damned sure I’ll stage my own wake.

  6. I hope to cover your questions in depth in a future article. The book value effects on MIH may already have been addressed through asset writedowns. Even if MIH has negative equity, it would not go into administration if it has sufficient cashflow or bank support to keep trading.

  7. Thanks cadizzy. You clearly know your stuff. “I suspect also that there is a collection of side letters in each and every case , probably hidden below the marble staircase, giving comfort to each player that they will not lose ” Let me ask you, what would be the significance of such letters- if they actually existed? 😉

  8. Anne- you may be right. They might simply not understand the case, its implications, and are just frightened of the relative complexity of the story compared to the pedestrian beat of Scottish football. However, they cannot be forgiven for allowing themselves to be manipulated by people associated with Rangers. All of those fakeover stories and misleading statements on the risks facing Rangers in the tax case- proven wrong time after time, yet they keep publishing the next wave.

  9. cadizzy says:


    re the side letters;
    as you know, in order for the contribution to the EBT to be effective, there has to be no right to it at any point on the part of the individual who is to be the beneficiary (in this case, the player). That is not a problem in city banks etc where all bonuses are totally discretionary (apart from sign ons etc) and technically, individuals only ever have a right to them when they actually receive the cash.

    In the case of salary or contractual bonus sacrifice, the individual irrevoocably gives up the right to a hitherto contractual amount with no guarantee that it will be replaced by anything of equal (or any) value. Can you imagine many football players nowadays buying into that kind of thing? (Actually, I think you already answered that question yesterday).

    In the past, in such circumstances, the more aggressive tax planners have advised the preparation of separate agreements, or letter of understanding, that restore a good deal, if not all, of the right
    that the individual previously irrevocably gave up. It may be in a different form but it gives the individual comfort that he is not going to lose out in this arrangement.

    HMRC’s view (and to be fair, that of many tax advisers) is that the side letter arrrangment undermines the salary sacrifice arrangement and indicates that such an arrangement is sham. There are cases where salary sacrifice works (with the blessing of HMRC) such as pension contributions and flexible benefits plans but disguised remuneration is not one of them.

    Incidentally, I noticed that yesterday you mentioned the Dextra case. It would be a shame for readers of the blog not to be aware that the inspector in that case was called Ronald MacDonald.

  10. JohnBhoy says:

    Fantastic stuff. Keep it coming.

  11. Paulsatim says:

    Annie M, is this your boss you are talking about or, is it just “your call”?

  12. rasputin says:

    It is not a continuation, there never was a hearing last October, hence First Tier status. Believe me I should know and I do know, c’est la vie.

  13. Funniest part of running this blog for 2 days is the visitor who googled “what is meant by ‘purveyors of succulent lamb”‘ (It links back this page so I see it as a referrer in the statistics).

    For anyone who really does not know about ‘succulent lamb’, it refers to the group of journalists who feed directly from the plate of Rangers FC and it’s now ’empty coat’ former Chairman, David Murray.

    A better google term would be just ‘succulent lamb’. You will find the original reference to one of the most sycophantic pieces of writing in Scottish history from James Traynor.

  14. Great to have your comments. So in language for those who might not be up on tax planning, a letter promising “you don’t have to repay this loan” would effectively destroy the claims to having just borrowed this money? Interesting. That would be just terrible for Rangers if such letters existed.

  15. rasputin says:

    Definitive proof that very little knowledge is a dangerous thing, still you appear well versed in very little knowledge. Ciao,,,,

  16. cadizzy says:

    The side letter is not to do with the loans or anything else that comes out of the trust; it is more about giving the individual comfort that he will be seen all right in relation to the amount of income he has irrevocably sacrificed for no consideration (i.e. he will get that value back in some way).

    So, to put it in cynicalese, the player gives up the right to what would have been an entitlement under a contract with no strings attached and the side letter re-attaches those strings. It negates the “irrevocable for no consideration” part of the sacrifice.

    Even if the side letter were not there, they’d have trouble convincing anyone that players are happy to give up money to which they are entitled in exchange for the employer perhaps,maybe,possibly putting money into the trust which might perhaps possibly get distributed to them by the trustees.

  17. cadizzy says:

    Just to add a bit about loans. Most loans from EBT’s are set up with a repayment date, let’s say, in three to six months time. When repayment date comes along, the trustees, at that time, make a decision to extend the loan period for another 3 to 6 months. This is repeated after the repayment date comes along. In this way, the loan is still seen as a loan and not a distribution which would be taxable (and subject to PAYE and NIC) even if the player has ceased to be resident in the UK.

  18. chico says:

    would HMRC call on player(s) to give evidence ? also, would these players have their own copy filed under their own marble stair case ?

  19. Pedro says:

    I was quite liking this blog for a bit there, until a hint of bias started to come into it – a thing you said you would avoid.

    I am a Rangers fan, one who is trained in tax issues, but one who has no knowledge of what is going on in the tax case other than what those in the know seem so determined to tell us all.

    All of what you have said so far is quite understandable, and so we are clear, this myth that all Rangers fans bury their heads in the sand and claim the tax issue is not there is nonsence.

    What might confuse some Celtic fans is the argument that they also know nothing about the case (or about Rangers financial state) and just state their views as fact – just as it was fact Rangers would go bust every year for the past 3, how they wouldn’t buy any players, and how they would sell every marketable asset in (insert date here) transfer window. The fact is the vast majority know nothing.

    (Just so I am clear, I am not suggesting this of you – in fact, It is good to hear a view on it, all be it a view that cannot be proved until the case is decided.)

    Another myth is the media in Scotland being pro Rangers – the laptop loyal I believe they are called. All in Murrays pockets apparantly. Its funny how every Celtic fan thinks the media is pro Rangers and the Rangers fans think the media is pro Celtic. What it proves is possibly the media is just rubbish, and that is a fact I certainly don’t disagree with in your blog. I refuse to accept the media is Rangers friendly – there may well be journalist that are close to Murray (or Peter Lawell), close to certain players from both teams, and who indeed support either team. However, they are not all pro Rangers, no where near it. The recent old firm furore and almost total support of Lennon would certainly support this.

    I offer the opinion that it is possible they are not willing to discuss the tax case in detail because either 1. They don’t understand it 2. Or perhaps no-one involved in the case is willing to talk about it (Rangers may not wish to set a panic in motion if all what you say is true, & The HRMC will certainly not wish to damage there case by spilling it through the media) or 3. Maybe they are waiting for the case to retsart in April and see where it goes before commenting or 4. there shit.

    In fact, the tax case has been mentioned in the media, several times, generally with Rangers having a potential tax hit of anwhere from 10 m to 60 mill, just not in the detail that your blog goes into.

    And finally, as i have touched upon already, the majority of Rangers fans are desperate to know the true facts about the situation in the tax case, the takeover & the current financial. To suggest that they all claim everything is ok is just rubbish. What they are not desperate for, is to hear gloating Celtic fans stating the end is nigh, when there are no hard facts to back up anything they say.

    As I said, I will continue to read your blog, but will discount anything with a hint of bias. Tax facts, and knowledge of the case is fine (al be it, again, knowledge that nobody can disprove), but anthing else just clouds the issue.

  20. Comedy gold, son! Keep them coming!

  21. On the bias question, it is hard for any of us to notice our real biases. Thanks for the heads-up and I will endeavour to be more vigilant.
    On the issue of journalism in Scotland, I am open to debating incompetence versus bias. If this is all genuine ignorance and stupidity, they really must be selected for low IQ.
    As I will cover in later articles, there are a few silver linings in the tax case- even if it hits big and administration is the result. I hope my bias comes across as much more anti-Scottish journalist than anti-Rangers. The Scottish game needs Rangers and Rangers fans need to start opening their eyes and stop being so defensive about anything that appears to be bad news. There are villains in this piece, but they don’t work for the bank. They were the Rangers directors who presided over this disaster. I cannot believe the easy ride Murray, Bain et al get from both the media and from your supporters.

  22. WorkTheSystem says:

    Very interesting commentary. Thanks also to the illuminating points raised by Cadizzy.

    I am a CA and well-versed in financial matters. EBTs are a bit of a curate’s egg. A particularly murky and, dare I say extremely aggressive, form of tax planning. One of the key competencies of a tax advisor is to advise on the risk profile of a particular form of planning- it seems that this may not have been the case in this instance. If any advice was proffered, it looks like this was binned at the first opportunity.

    I am not sure how relevant this is to tax proceedings but I cannot help but think that a consideration of the legal criteria of ‘substance over form’ will be key to any judgment of Rangers’ use of EBTs. It is self-evident how the chips will fall if this test is applied.

    I think the main thrust of your argument though is the one worthy of most consideration. There has been a wilful avoidance, dare I say, evasion by the Scottish media into these issues over at Edmiston Drive.

    Understandably a lot of Rangers fans don’t want to address it- no one likes to face realities when they are so bleak. However, it is crucial for those fans that do love their team to demand some answers from those charged with holding those in power to account.

    Taking your understandable frustrations out on erudite, illuminating blogs is to focus on the wrong target. Ask these questions, ask them repeatedly to the media and custodians of your club. Don’t shoot the messenger as they say.

  23. cadizzy says:


    I agree with you that there has been mention of a possible hit for Rangers of anything up to £60m; I also concede that the media may simply repeat what they hear from Ibrox (or Parkhead for that matter) because they do not have the expertise to say anything different.

    What I am certain of is how EBT’s (and the sub fund family benefits trusts) work. It seems from what has been published, that Rangers did set up such a trust (and I assume the FBT would follow). Rangers (and football) do not have payment structures that are conducive to an effective EBT arrangement; that is a simple fact. HMRC do not have a problem with EBT’s per se (where any POTENTIAL future right to a discretionary bonus is foregone); their problem is with how the money comes out. The outcome of Dextra and the subsequent change in legilsation means that HMRC achieves symmetry in relation to the timing of the income and NIC charge and the corporate tax deduction. If it comes out “tax free” then no CT deduction is available.

    Of course if the employing company is loss making, or has loss carryovers, that company couldn’t care less about the CT deduction so is happy to see employees going the loan/Algarve villa route. That practice has aggrieved HMRC, hence the recent closing of it. However, I have been told in an unguarded moment that what they are really sick of is footballers having most, if not all, of their income sheltered from UK tax. That clearly suggests a sacrificing of otherwise contractual amounts (since nobody works for nothing or just a promise). I think that is where Rangers have a big problem. Even if the paperwork is tight, there is still the argument of “substance over form” and there is little substance in the Rangers arrangements if what I believe to have gone on is indeed the case.

    Allowing for my assumption that Rangers have gone down the EBT route, do you agree with my post?

  24. Pedro says:

    I do not disagree with anything about EBT that you or the main blog have discussed. It was always my understanding that EBT’s in themselfs were not what was wrong, but in fact how it was administered.

    The main issue I was trying to get across was this myth that Rangers fans all think it is ok – I accept like all supports there is the minority that either don’t have the intelligence to understand the issues, or potentially just don’t care. There are, however, plenty who are unhappy with the papers and their lack of investigative journalism into the tax issue, into the takeover (particulary in relation to where Whyte is getting his money from) and also in relation to the LLoyds connection.

    All I want (and I suspect many Rangers fans want) is the truth.

  25. Pedro says:

    We certainly could argue all day about bias v incompetence, but I would guess it would a fruitless task, in the sense, you could look at any article on a particular day about the old firm, and a Celtic fan would think it painted them in a negative light, and a Rangers fan would think it paints them in a neagtive light. That is the nature of the beast that is the West of Scotland.

    Again, I don’t believe all Rangers fans are defensive, and certainly, I did not meant to come across as defensive of what your blog is saying. My main issue was with the the media bias and the fact that people think the Rangers support ignore anything bad.

    What the Rangers support want is the truth – from the club, from Murray, and from the bank. Statements of fact, not tabloid reports and blogs.

    In relation to the easy ride of Murray and Bain. Certainly Murray has taken himself out of the public eye of late, but I think many Rangers fans are extremely unhappy with the mismanagement.

    Bain is disliked however. From his inability to negotiate trasfers, contracts etc to his apparant inability to defend Rangers in certain issues, he is a much maligned figure.

    However, I will accept that the Rangers support at the moment are not really up for the fight of protests etc. This has came from being fed up with the lack of information and lies that the support have been fed. Therefore, yes, they probably get an easier ride that they might have got in the past.

    As for the media giving them an easy ride.

  26. Pedro,
    Firstly let me say that it is a pleasure to have a rational discussion with a Rangers fan on this topic (or any other for that matter). The hysterical extremism we find on the most popular boards drowns out the sane on both sides.
    To your point about media recognition of the tax case, it might be true that it has been accepted as fact, but only very recently. In the week when this story first broke we had Hugh Keevins claiming that Rangers were consulting their lawyers about writs against the News of The World. Darrell King either fell out with his source for his (quite good) stories in the Herald / Evening Times. (Or he forgot his passwords to the celtic messageboards where he lifted the data). Darrell had the makings of a great series of stories, but then seemed to drop the issue and joined the fakeover bandwagons.
    There are also hacks like Ronnie Cully who are clearly pro-Celtic, but I think that the majority are partial to your club. Then there are the wind up merchants like Keevins whose role is to agitate the most sensitive from both sets of fans. However, I truly believe that David Murray has an unnatural grip on a number of prominent journalists and editors. That he has managed to avoid the type of wrath thrown at the White/Kelly dynasty at Celtic during the latter stages of their reign is confirmation for me that much of the media is still in his back-pocket.

  27. JPaul says:

    What is aggravating Rangers problems even further just now is that HMRC, at the Government’s behest, are aggressively dealing with tax avoidance cases. The Government has realised the vast sums of money involved in these cases and in the current economic climate it has no option but to try to collect this. Hence the £900m being invested in HMRC investigations, at a time when cuts are being made elsewhere. That will be used to bolster the work on both avoidance and evasion.

    The bottom line is that, in cases like this, they will wish to collect the outstanding tax, interest at commercial rates since the tax was actually due, and a civil penalty in relation to the tax being avoided in the first place. There is a lot of money involved and put simply the Government really needs to collect it. There is a good argument that this is more important to them than evasion cases, which are much more difficult to prove and normally result in custodial sentences, which ironically cost the Government money rather than bringing it in.

  28. rasputin says:

    Any secret dossiers on the go, you know the sort, refs, tax cases, care in the community, lack of care in the community that sort of thing,cos your taxation fairytale is just that..must dash is a calling,,,tout de suite…

  29. WorkTheSystem says:

    I’m not sure about unnatural grip. The one thing that Dave has always had in his favour is to treat such journos with a flattery and ‘respect’ far beyond what was ever merited. ‘Succulent lamb’, visits to vineyards, private audiences in Charlotte Square, the private jet, etc.

    Some of their deluded number may consider him to be a friend. Such flattery has bought more than a large portion of good-will with the 4th Estate. It shows the esteem in which they hold both themselves and their ‘profession’ that they can be rolled over and have their bellies tickled for a nice steak dinner and a cosy fire-side chat.

    Jimmy Breslin, Paul Foot, Bernstein & Woodward they most certainly are not.

  30. Pedro says:

    There are more sane fans than each team are given credit for.

    I would say Murray getting an easy ride and Rangers getting an easy ride are now, more than ever, a separate thing.

    I will accept Murray may will have a lot of people on his side, in the media. However, I cannot agree that Rangers as a club get an easy ride. Now, we could argue whats the difference. In my opinion (not based on any facts), I wouldn’t be surprised if many of the cuts being made at Rangers are in fact the responsibility of Murray, not the bank as the media would have us believe. And I also believe that Murray feeds this to the media, in particularly Traynor.

    However, this is all done to paint Murray in a better light. In regard to Rangers, I would think few would disagree that they get plenty of negative reports in the media in regards to the financial state of the club (its hardly kept quiet, and always reports of impending doom), in regards to the signing of Diouf, in regards to the songsheet, in regards to the recent old firm performances (apart from the latest one) and in regard to the old firm shame game. Now, I am nor for one minute suggesting the media are wrong to highlight these issues, just making the point that they are discussed.

    I’ll agree to disagree, mainly because i don’t have time to continue, but I am sure your next blog will bring up plenty of talking points.

  31. tony says:

    You were doing well until this ” The recent old firm furore and almost total support of Lennon would certainly support this”.

    You have got to be joking, or maybe you think we are all complete imbiciles!

  32. M McK says:

    If Rangers lose their fight with HMRC and do indeed enter administration I assume that will result in a points deduction as per SPL/SFL terms and conditions?

  33. George Dallas Peat says:

    I think we are losing sight of how important Rangers football club is to Scottish football industry. If Rangers do become a Third Lanark then the question; where will that leave the professional game in Scotland has never been asked . Why ?

    Is this to protect an ailing Scottish entertainment industry ?

    Fact is Scottish football is bankrupt. Without Old Firm money at the gates and Old Firm TV deals there would be no professional game in Scotland.

    The men in charge of Scottish football have a lot questions to answer. They have a duty to the game in Scotland.

    It is exactly for this reason that information has been deliberately suppressed.

    Rangers were technically bankrupt last year. Hence the equity for debt exchange between MIH and LLoyds.

    This information did not see the light of day for quite some time. Long enough for the SFA to provide a licence for Rangers still to continue within European competition. That´s why this information is being suppressed.

    This brings in a moral dilemma. Are the Bankers and Blazers lying to us to protect the Scottish game or their own interests ?

    History tells us it is always to protect Glasgow Rangers.

    Diouf signing tells us that also

  34. cadizzy says:


    I am not sure if this comment below is aimed at me.

    “Definitive proof that very little knowledge is a dangerous thing, still you appear well versed in very little knowledge. Ciao,,,,”

    I do not profess to know for sure what happened at Rangers but I do know how EBT’s work since it has been part of what I do for a living for some time and so am equipped to give a reasonable view on likely circumstances. Perhaps you can tell me where I go wrong technically with my little knowledge. Feel free to reference case law and legislation.

  35. cadizzy says:

    chico says:
    29/03/2011 at 12:13 pm
    would HMRC call on player(s) to give evidence ? also, would these players have their own copy filed under their own marble stair case ?

    Chico, given that the side letters (if indeed they have gone down this route) exist for the protection of the players, I’d guess that they would have a copy lodged with their lawyers. As to whether or not they’d be called as witnesses at the tribunal or at a higher court if it goes further, it is not impossible. However, given that many of them were foreign and would now have moved out of the UK, it may prove problematic.

  36. George Dallas Peat says:


    is it not normal practice for someone from such an industry like football to stave off their earnings over a longer period. I.e football career = 10 years. So take that 10 year income and pay yourself that income over 40 years ?

  37. chico says:

    thsnks for replying cadizzy

    how about a former player with a grudge ? must be a few of them around

  38. cadizzy says:

    George Dallas Peat

    Firstly, can I say you have a really cool name. It’s like an amalgam of all that is good about Scoottish football 0-;)

    I can’t see how a player can do that easily when he could have 3 or 4 different employers in that 10 years. The only way to do that is by deferring receipt of the income (and by having it redirected into a trust by the employer) which is what Rangers have tried to do.

    The problem is still that the payment becomes taxable when the individual receives it or has a right to receive it (constructive receipt). Footballers income tends to be contractual rather than at the discretion of the employer so effective deferral can be quite difficult. It also means that each employer has a continuing withholding obligation to the point at which the player receives the money from the trust. The employer can ask the trustee to carry out that withholding responsibility on its behalf but it is still messy (not Messi).

  39. Victor_Arbuckle says:

    Great blog and an even better discussion. This is probably the only place I have seen an informed debate on this subject. My only question… where have you all been for the last year?

  40. Pedro says:

    I don’t assume anyone is an imbecile. And maybe this point you picked up one probably reflects what I am trying to say – that people see what they want to in the media, maybe myself included.

    To clarify my point – in my opinion, Lennon acted like an idiot on the touchline. Twice. Thats just my opinion. His reaction to whatever Mccoist said was, even in the Celtic boards eyes, not what is expected of their manager. Thats not to absolve Mccoist of any blame, but its what was seen on TV.

    Now, the media reporting of that game afterwards, again only in my opinion, was quite lenient on Lennon’s reaction (and indeed his part in the Diouf incident). Most of the blame for everything that went on was put at Rangers door, their players, their fans etc. It wasn’t until the useless Bain made a statement highlighting earlier issues between Lennon and Diouf/Weiss/Naismith that people started to question Lennons part in it.

    Then the Celtic spin machine went into action, and Lennon became the victim in pretty much everything he has been involved in negatively this season. (again, no complaints with that, thats what a PR team and Chief Executive are for). Now, what this highlights, is that Celtic have every bit as much hold on the media as Rangers do, and that was the point I was making.

    And to clarify before I get any stick, I don’t agree with the racist accusations, and obviously not the death threats.

  41. George Dallas Peat says:


    4 different employers but possibly only one Monaco based agent with a Scottish surname. 😉

    Player is permanently sub contracted to an offshore trust that is set up by such an agent.

    Player is only ever contracted to that trust. That trust agrees to provide services of said player during the duration of that contract.

    Player then arranges deferred payment to his home African bank account 4 years after he has left Rangers.

    HMRC are then left hoping African footballer is going to be honest. 4 years later, Which of course he isn´t

    Obligation is on HMRC to prove that funds from an offshore bank account have arrived in African bank account and used by said individual. Which they cant.

    Dies that not mean game over for HMRC ?

    Hail Hail

  42. Ramsay Smith says:

    Am I right in thinking that football agents are on a % of their client’s earnings?

    If so, do they get a % of the sums paid into the EBT?

    And does the contract between the footballer and the agent make any reference to the EBT?

  43. cadizzy says:

    George Dallas Peat

    The problem with that arrangement is that even if the player were employed by someone other than the club he plays for, he would still have to be seconded to the football club for whom he plays and he would still be performing duties of his employment (whoever the employer is or whoever is pretending to be the employer) in the UK and therefore subject to tax and NIC with the PAYE responsibility falling on the company to which the employee is seconded i.e. the football club.

    Okay, there may be a small deduction available in relation to income for games played outside the UK (provided the contract is relatively short term and he is paid outside the UK but the plan you set out doesn’t work as far as I can see. If it does, it relies on very aggressive planning that is invisible to HMRC.

  44. Pedro says:

    I would argue with this point that Rangers were bankrupt – I believe on several occasions it has been stressed that MIH are separate from Rangers, hence the tax bill being Rangers not MIH.

    And also the statement

    What is interesting is what would happen if Rangers went under. Many Celtic fans see this as the holy grail, and many see it as the death knell of Scottish Football. Some see it as the way to get rid of its”ugly sister” and get into the premiership, and some see it as the death of Sky TV money and decent competition for the league and cups. And therefore a decline in Celtics Turnover and ability to compete in Europe.

    In ref to “The men in charge of Scottish football have a lot questions to answer. They have a duty to the game in Scotland.

    It is exactly for this reason that information has been deliberately suppressed”. I don’t buy this. I don’t buy that Rangers financials were suppressed as they cannot suppress them under law. The fact his Rangers generated a healthy proft last year.

    Outside of the fans who do not want Rangers to go under, I would suggest Lloyds and the tax man really don’t want them to go under. Lloyds, whatever the debt level are making money from Rangers on substantial interest. And HMRC – well, Rangers go under, try getting the tax due/penalty/interest. They are no longer a preferential creditor.

    So, in my opinion, it isn’t in Rangers interests, that the blazers and bankers keep information quiet. If they do at all.

  45. Paulsatim says:

    Annie M, is this your boss you are talking about or, is it just “your call”?

  46. This could also be a breach of the Third Party Payer rules. I cannot recite them chapter and verse but the basic principle is that players need to be employees of the clubs to whom they are registered.

  47. I don’t know the mechanics for how agents are paid, whether the club pays the players’ income to the agent in the first instance and the agent deducts his expenses and commission (this is how it is normally done in the entertainment industry), but the key point of yesterday’s article makes clear (and supported by the informed commentary of both Celtic & Rangers fans responses here) that if players contracts spell out how the EBT is supposed to work, the whole premise of an EBT falls apart.
    So if Rangers have provided their players with letters that tell them that they do not have to repay the loans from the EBT, their goose would be cooked. Not sure what more I can say than, I hope for Rangers’ sake that they were not so stupid as to write such letters.

  48. Ramsay Smith says:

    George Dallas Peat says:
    29/03/2011 at 4:00 pm

    ‘Player is permanently sub contracted to an offshore trust that is set up by such an agent’

    What do you mean by ‘permanently sub contracted’? There is no contractual relationship between a trust and a beneficiary. That is one of the essential elements of a trust.

    Rangers held the players’ registrations.

    Only the club holding the registration can pay the player.

  49. Correct Ramsay. An employment relationship between the EBT and the player would undermine the point of the trust.

    GDP are you mixing the EBT arrangement up with the idea of offshore contracting arrangements?

  50. Brattbakkk says:

    Did an RFC executive benefit from this scheme?

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