the Taxman cometh

Taken from the LEP business pages

Preston North End supporters have been warned the taxman is hunting debt-ridden football clubs.

Jeremy Oddie, regional director of insolvency industry body R3, said the Inland Revenue was fighting a legal battle to stop footballers becoming preferred creditors if clubs go under.

It has seen it go to the Supreme Court against the Football Association in a bid to change the rules.

PNE chairman Maurice Lindsay yesterday told supporters that owner Trevor Hemmings had set a £3m limit on the amount he was willing to pump into the club for the coming season, forcing it to sell key players, including prize winger Keith Treacy to Burnley.

Mr Oddie said: “The Revenue has become far more robust with football clubs, it is not prepared to allow huge unpaid tax bills to build up within a club. There is a pressure point there and they will be watching the situation with regards a lot of clubs, not just PNE.”

He said the Revenue wants to change a “peculiarity” in the tax rules which currently means the taxman is missing out on huge chunks of cash through PAYE bills when clubs go under.

Football finance expert Tom Cannon, a professor at Liverpool John Moores’ University, said he did not believe North End would be allowed to disappear, but said administration was a stark reality without cutting costs.

He said the loss of revenue from television deal, which sees just 20% of the overall pot handed out to teams in the bottom two divisions, would be a major hit.

Prof Cannon said: “No supporter likes to see their best players sold off but this is just life in the lower divisions of the Football League, you have to cut your cloth accordingly. I think a club with a history like Preston would be allowed to disappear, but you only have to ask supporters of clubs like Stockport County to see that administration and relegation into the non-League is very real.

“I do not think Trevor Hemmings was ever going to be a white knight, but what he is doing now could lay the foundations for a more stable future for the club.”

 

I think the only thing missing from the above is Trevor Hemmings and chairman Mo's signature at the bottom. I wonder why PNE are the main focus of attention in this article. A nice try to pacify the PNE supporters using the LEP following the U turn made by TH/ML re Treacy going to the dingles,but it wont wash.