Professional football clubs and their players -- past and present -- "may face bankruptcy over the non-payment of taxes," which could total up to £100M ($121.8M), according to SKY SPORTS. A legal test case, scheduled for the U.K. Supreme Court, will see Scottish Premiership side Rangers and U.K. tax authority HMRC "lock horns on March 15." Victory for HMRC is "expected to prompt a wave of aggressive tax demands to professional football clubs" across the U.K., while rugby union and rugby league clubs "may also be affected." The case centers on the use of employee benefit trusts, which HMRC suggests have "allowed clubs and players to avoid paying tax on wages," dating as far back as '99. There is "no upper limit" on the sums sought by HMRC. Clubs could be hit with accelerated payment notices "immediately and would have 90 days to either contest the demands or pay up." Some football clubs have already paid HMRC officials "to avoid being hit with large income tax demands, and several clubs are understood to have reached private settlements with HMRC in recent months due to concerns about its investigations into EBTs." If HMRC loses the Supreme Court battle in March, however, it is understood the clubs will "escape further investigation, with attentions turning instead to the players themselves." This is "likely to cause exaggerated problems for retired players who benefited from EBTs but are no longer able to generate funds needed to pay" (SKY SPORTS, 3/9).
