The former Rangers Football Club plc, which is now in liquidation, has won its appeal against a tax bill from HM Revenue and Customs (HMRC) for its use of an employee benefit trust (EBT).
In a majority decision, the first tier tribunal concluded that the club’s payments to players and staff through the EBT were as loans, not earnings, and so were not subject to tax.
HMRC had argued that the EBT was written into employees’ contracts, that it was not discretionary and so formed a taxable part of their contracts.
Charles Green, chief executive at Rangers Football Club Ltd, a corporation entity that was formed in June 2012, said: “I am sure that all Rangers’ fans will welcome that a judgment has been reached on this case at last.”
HMRC has stated that it is considering an appeal. A spokesperson said: “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.”