Rangers to go into administration

Rangers are to go into administration after lodging the notice in Edinburgh at Monday lunchtime.

It is understood Gers have five days in which to formally declare administrators have taken over the running of the club.

The Scottish Premier League champions are facing an uncertain future as they await the verdict of a tax tribunal.

The famous Ibrox club could face a bill in the region of £49million should they lose their dispute with HM Revenue & Customs (HMRC).

The club's financial problems are well documented following the decision to sell star striker Nikica Jelavic to Everton in January.

Gers have now shown their hand after lodging an intention to go into administration with the Court of Session.

http://www1.skysports.com/football/news/11788/7518679/Gers-to-go-into-administration

I remember when Leeds went into Administration and it was a bad day indeed. I wouldn't wish this on any club, even a rival club. So what's the implications, how many points deduction would they be looking at?

Hilarious news. Completely deserved and no doubt a 10 point deduction every season until they get out, unfortunately the SPL is so bad that they'll still come second.

As s_r says, doubt a points docking really means much in the SPL, they still won't get relegated and they'll probably still get into Europe at least. Looks like a clever way out of a tax bill to me!

Could well be TopHat. Been coming for a while now, Ally needs to make sure the team play football and forget about all the bs.

Yeah it's an automatic, immediate 10 point deduction for going in to Administration.

Can't say I'm too upset about it.

Top Hat, they haven't a hope of getting any further than the qualifying rounds.
I think in 2012/13 the league winners get in to the Champions League (although I'm not even sure about that, the certainly don't deserve too), but it's the last time this will ever happen bearing how poorly the league is rated by UEFA.
No Scottish team will ever make it through CL qualifying.

I actually think Scottish football needs this wake up.

super_realist wrote:... I actually think Scottish football needs this wake up.

I think you are right. At least they could re-evaluate where Scottish football is going as a whole. With the top teams not going anywhere (they are staying in the Scottish league), Celtic, Rangers and others (Aberdeen, Dundee have done well in Europe in the past), just don't have the income to compete at the European level.

On a lower level, other Scottish teams don't have the income to compete against Celtic and Rangers. My view is that Scottish football should focus on developing home grown talent and building up their national side. They should also consider the possibility of making the Scottish league more competitive (so that it is not just Celtic and Rangers competing for top honours all the time (it seems)).

Rangers can be docked 10 points right now and they're still second, in the Champs league spots and would be 9 points ahead of third. So it makes no difference. Next season it will business resumed as usual with them vying for the title.

Whilst they may or may not be good enough to get through qualifying rounds, the fact is they will have the opportunity so the effect of the deduction/penalty is nothing.

Not sure this is really a wake-up either, it's just over a tax dispute which isn't really football related. At the end of the day, as I said before, this is just a clever pain-free escape from an HMRC shafting!

It's only an initial 10 points though.

The fact they have gone into Admin to avoid a winding up order from HMRC won't go down at all well with the SPL, i'd expect them to get at least the 25 points that Dundee got.

Being as they love the royal family so much why dont they ask them for a for a few quid to help out

Tophat, the truth is that they won't be allowed to buy players and will have to sell what few assets they have to pay creditors, so the likes of Naismisth , Davis and Macgregor will be away and Rangers will probably be a team only fractionally better than Dundee United and Hearts (if Hearts don't follow Rangers into admin).
True, the points deduction isn't a punishment in the short time, but long term, Rangers are absolutely screwed in terms of ever calling themselves a big team again. After all look what has happened to all the teams that have done the same: Leeds, Portsmouth, Gretna, Dundee, Livingston.

I also don't think that second place will get into the Champions league, and even if they did, they'd get pumped in the first qualifying round to a minnow, just as happened this year.
So no real income from even a Qualification round as they'd be home before the post cards

Looks like a pretty cynical move to me.
They would be ill advised to try to fool 'the establishment.'

Very true SR

They will get buttons for the likes of Macgregor. Serves them right, look at all of the Edinburgh team players they have pinched at the end of thier contracts. Could be a good sea change for Scottish football though.

And to think this is the club that has the business nous to turn down 7 million for Jelavic and sell him for 5.5 million

As a United fan, it's frustrating to see the likes of Conway and Goodie going out the door, lowering my expectations from fighting for 3rd to fighting for top 6, but looking at moments like whats happening to Rangers and to a lesser extent at Hearts, I'm glad Steven Thompson is looking beyond the here and now and will hopefully lead to some sucess in the future.

According to the BBC website they won't be allowed to play European football if they are still in administration though.

A sad day for Scottish football and rangers FC. I'm sure rangers will get throu this, there too big a club.

Hard to have much sympathy with Rangers as a club as this is entirely of their own doing. Even as a Celtic fan I would extend some sympathy to the fans, but, I do think that a fairly significant section of the Rangers support have had their heads in the sand about this for a long time. Typically, as all football fans tend to do, short term success was allowed to divert from deep failings in the way the club was being run.

Still, would imagine that Rangers will be back to a position of relative strength in a year or two. Still have resources far in excess of everyone but Celtic and its unlikely that the Celtic board will push the boat out if leagues and cups can be won with the bare minimum.

I have a lot of sympathy for the rangers fans.
I'm not much of a fan now but I was back in the old sack the board days.
A bad time for CFC then but I felt the fans got behind the team and we pulled throu. Rangers need to do the same here.

Would it not be wonderful if they could open up the 'new club' as one that is owned and run by the fans.

Having done a bit of background reading on the saga, several questions immediately spring to mind.
They started EBTs in 2001, a perfectly legal thing to do (it's the way they have administered it that is allegedly the problem). Surely though, if there were doubts about the legality of how the scheme was being administered why didn't HMRC raise such concerns as early as 2002 (or is this yet another example of HMRC belatedly moving the goalposts, hiding behind the old case law trick??

Next....lawyers accountants and especially auditors...did the people tasked with carrying out these professional services on behalf of Rangers perform their roles with even adequate professionalism?

Next, Bain and McLelland and any other senior directors at the helm during the Murray era, did they properly exercise due diligence in their directorial duties toward the club??

They have a 10pt deduction as of now and have gone into administration

Have we got any Tax experts in the house that can even attempt to answer the questions I posed in my previous post, particularly the first one?

To anyone who is an accountant or auditor, would it not have been obvious looking at Rangers accounts that there were irregularities brewing?

JAS, the first question sprung to mind straight away when I read deeper into this. I asked a friend who works for HMRC this question and his response was that it's impossible for HMRC to adequately review everyone's accounts each year. They simply don't have the manpower. Simply, when the EBT scheme usage came to light, they went back and reviewed the older accounts. He's not clued up on the fine points of the details and was merely offering his opinion.

Have you come across http://rangerstaxcase.com ? You may find some answers there.

They started EBTs in 2001, a perfectly legal thing to do (it's the way they have administered it that is allegedly the problem). Surely though, if there were doubts about the legality of how the scheme was being administered why didn't HMRC raise such concerns as early as 2002 (or is this yet another example of HMRC belatedly moving the goalposts, hiding behind the old case law trick??

From what I understand most businesses used EBT's for the pension scheme, Rangers were using EBT's not to top up pensions but in a way to avoid paying as much tax as they'd normally have to pay, paying players through EBT's, for example, if Rangers paid Ronald de Boer £40k per week they'd give him two contracts, one say on 10k per week, which would be tax deductable and the other £30k was paid using an EBT which avoided any tax, and this is where Rangers have been caught cheating the system

HMRC are insisting that Rangers have intentionally mis-used EBT's in order to avoid paying the correct amount of Tax on player's wages

TopHat24/7 wrote:As s_r says, doubt a points docking really means much in the SPL, they still won't get relegated and they'll probably still get into Europe at least. Looks like a clever way out of a tax bill to me!

Rangers need to be out of Administration by March 31 or they wouldn't be eligible for Europe regardless of where they finish or what they win, and although I'm not sure there is any definitive ruling, I'm sure Uefa have distanced themselvevs frrom including teams in administration, Portsmouth were the first British team to find this out

There would also be a transfrer embargo

As for it being a clever way of getting out of a tax bill, you couldn't be more wrong my friend, HMRC will get their money back one way or another, if it was easy as going into administration then coming out unscathed every business in the UK would be doing it, they don't because it's as far away from clever as you'll find

Makes you wonder what was going on at boardroom level at Rangers. Either they thought having two contracts, but not disclosing them to the SFA, SPL and HMRC, was legal (which i seriously doubt), or they knew the illegalities of it but decided to soldier on.

Campbell Ogilvie was has some serious questions to answer about this.

the-gaffer wrote:

They started EBTs in 2001, a perfectly legal thing to do (it's the way they have administered it that is allegedly the problem). Surely though, if there were doubts about the legality of how the scheme was being administered why didn't HMRC raise such concerns as early as 2002 (or is this yet another example of HMRC belatedly moving the goalposts, hiding behind the old case law trick??

From what I understand most businesses used EBT's for the pension scheme, Rangers were using EBT's not to top up pensions but in a way to avoid paying as much tax as they'd normally have to pay, paying players through EBT's, for example, if Rangers paid Ronald de Boer £40k per week they'd give him two contracts, one say on 10k per week, which would be tax deductable and the other £30k was paid using an EBT which avoided any tax, and this is where Rangers have been caught cheating the system

HMRC are insisting that Rangers have intentionally mis-used EBT's in order to avoid paying the correct amount of Tax on player's wages

This is correct.

This really depends on how much HMRC want to make a point to the rest of football with Rangers. Administration looks very much like a tactical move by Mr Whyte, it's hardly a master stroke but he's not got a whole host of options and from a business point of view Admin looks the best decision.

Rangers are obviously hoping to make a deal with HMRC for a portion of the money to be repaid, though HMRC could easily rebuff any offer and look to set an example by taking Rangers to the wall.

I think when HMRC today made a motion to take control of the Aministration of Rangers I personally believe that it was a line in the sand, I don't think they're willing to play ball with Rangers

I can't really blame them, they have been given the finger regarding tax for years now by many clubs, a lot of them down in England. Now they finally have their hands on one it looks like and with a big name to boot in Rangers and I'm not sure they care about the money as they do making an example of Rangers as a boogeyman to frighten other clubs with.

I still think that's why the chased Redknapp for so long due to his involvement in football, again I think they wanted to make a statement and they must be smarting a bit from that not coming of.