HMRC on the warpath big time
Posted by John Beech on January 5, 2010
There is increasing evidence that HMRC are adopting a much more aggressive, and thereby less tolerant, policy towards football clubs, which is hardly surprising in the circumstances.
Back in July they served a winding-up petition on King’s Lynn, to add to the serious problems the club was already facing, including enforced demotion (see postings passim and in particular King’s Lynn down a key player as they face HMRC). This proved the straw that broke the camel’s back, the club folding.
King’s Lynn were not alone in being served winding-up petitions by HMRC. Other non-league clubs to have had the same treatment in recent months are Harlow Town, Hinckley United and Margate, all with less dire consequences fortunately. (Use the Search function directly above the images in the right-hand column to find earlier postings)
Not that HMRC’s actions have been exclusively against non-league football clubs. A number of rugby clubs have also been served winding-up petitions, and so have five Football League clubs.
In September HMRC served a winding-up petition on Rochdale (1), seemingly in response to what they saw as the club’s continuing reluctance to pay rather than in a belief that the club was in any way unable to pay. I have seen no news on this since, so assume the flexing of HMRC muscles had the desired effect.
Accrington Stanley were taken to the brink in November, the action forcing a takeover of the club (see postings passim). Southend United have had a long battle, having been in court on 29 July 2009, 28 October 2009, 4 November 2009 and 9 November 2009 before finally getting the petition dismiseed (2, and see also postings passim).
HMRC’s latest skirmishes have been with Cardiff City and Notts County.
Cardiff City I have blogged about on a number of occasions previously, noting the need to decode club statements. The latest round involves stolen documents and angry statements from Peter Ridsdale. In brief, in mid-December legal confrontation resulted in an agreement being reached over a debt of £1.2 million (3). However, according to a report in The News of the World (4), Cardiff were once again in trouble with HMRC for failing to meet the first repayment agreed. Ridsdale duly issued a statement in response (5), which, while insisting that the report was out-of-date and protesting that it was based on documents stolen from the club, was noticable in its lack of denial that the club had indeed failed to meet the first payment on time. He declared “We are happy that Cardiff City Football Club’s relationships with its creditors including HMRC are such that we will not have any financial issues that will affect the ability of the Club to continue to trade as normal in all aspects of its business“. Certainly Cardiff City Supporters Trust are less than happy with the situation (6), and it seems unlikely that HMRC share Ridsdale’s happiness.
Meanwhile over at deeply troubled Notts County, the club is experiencing an HMRC double whammy – the serving of a second winding-up petition (7). An HMRC spokesperson said “We provide time to pay for viable businesses“. I wonder just how many football clubs receiving HMRC winding-up petitions will find any comfort in that.
Of course it would be remiss of me to forget to include Portsmouth in this list of miscreants. Here we are promissed ‘a statement will be released later today which will “explain everything”‘ (8). Everything??? We can expect a lengthy statement then.