Former Rangers players and officials face huge bills as taxman demands money owed over EBTs
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Former players and staff of now defunct Rangers Football Club 2012 Plc, who were paid through an offshore trust, have been issued a warning that HM Revenue and Customs will now move to recover the tax it is owed as a result of the practice following the recent Supreme Court decision over the affair.
While HMRC can still pursue BDO - the liquidators of RFC 2012 Plc - for a portion of what the company owed, pursuing the former employees is likely to reap a greater portion of that owed to the public purse.
Beneficiaries of the Employee Benefit Trusts (EBTs), many of whom were led to believe the loans made to them were their wages and would never have to be repaid, are now being warned to seek “urgent advice”.
They have been told that they have weeks to approach the taxman over a settlement or see their bill increase in a less favourable, imposed demand.
Last year the Supreme Court upheld a Court of Session ruling that £47m paid to Rangers employees between 2001-2010 was liable for tax.
Former captain Barry Ferguson received £2.5m in EBT payments, German goalkeeper Stefan Klos £2m and former manager - and current Scotland boss - Alex McLeish £1.7m, while former owner Sir David Murray received £6.3m.
The letter adds: “If you do not come forward voluntarily and seek to settle on preferential terms, HMRC could well pursue you directly and make an assessment on a less favourable basis.”
HMRC said: “Follower notice (FN) legislation says that HMRC has 12 months to issue FNs following a final decision. The final decision in Rangers was on 5 July 2017. We have looked at a range of schemes where the principles at stake were similar, and follower notices have been issued where appropriate.”
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