PL charge City for alleged breaches of financial rules

[Prestwich_Blue]

I do not agree Seems the Fordham scheme was more like Barcelona pulling leavers. Us selling image rights for an up front fee large lump sum to lower losses (more tax) in exchange for lower income in future periods when we had lower Losses anyway and less need for the income

You're on the right lines I believe. Fordham was about bringing revenue in via an up-front lump sum, rather than tax avoidance, and my view is that was done to try to help us avoid sanction under FFP.

Although we knew we were going to fail, the Annex XI provision about pre-2010 wages gave us a get-out if we could show that these wages were the sole reason for our losses. Knowing what those allowable wages were, we knew what the maximum allowable loss was, and the Fordham payment was (in my view) a device to help us achieve that.

Of course, as we now know, UEFA made a change to the method of calculation about those wages and how they could be applied, which made us fall just outside the maximum allowable loss. I suspect that we probably wouldn't have bothered with the Fordham arrangement had we known the way it would play out but it was too late once we did know.

Image rights are certainly a device to minimise tax payments, by paying a player's company for the use of their image. The tax burden then falls on the player's company, rather than the club. If the club pays a player £100k a week, with no image rights, the club will pay tax & NI on that full £100k. By paying £90k in salary and £10k in images rights, the club reduces its tax & NI liability by £10k. HMRC's rule of thumb is that, under normal circumstances, 10% of a player's remuneration is acceptable. I suspect the disputes with the likes of united and Newcastle are over the amounts paid, and therefore their tax liability.

 

[halfcenturyup]

Oh dear. More great management from the PL. That's another four or five clubs penalised next year, including a couple of big ones, I imagine.

https://www.bbc.com/sport/football/68790602

 

[halfcenturyup]

Speculation only: I still don’t really understand why we gave them nothing beyond 2018; perhaps for this reason?

I think it's more likely they didn't ask for information post 2018. God knows why, though .....

On the other hand, if I was really trying to understand anything the PL was doing, I would be going crazy.

 

[Centurions]

I think it's more likely they didn't ask for information post 2018. God knows why, though .....

On the other hand, if I was really trying to understand anything the PL was doing, I would be going crazy.

Unless I'm misunderstanding surely it's because the investigation started then?

 

[halfcenturyup]

Unless I'm misunderstanding surely it's because the investigation started then?

That's the allegation of non-cooperation, yes, but they haven't included any other allegations after 2018 which means either i) all the club's alleged naughty business had finished by then (which doesn't make much sense) or ii) they didn't look at records after 2018 (which doesn't make much sense either tbh).

Still, I gave up trying to make sense of what the PL does last February.

 

[KS55]

PL BOARD MEETING MINUTES. Wednesday 10 April 2024.
CHAIR: “What the fuck are we doing?”
CEO: “No bloody idea.”
DIRECTOR 1: “Me neither”
DIRECTOR 2: “Nope”
CHAIR: “Anybody?”
ALL: Silence
CHAIR: “The resolution is that we have no fucking idea what we are doing. All those in favour say ‘Aye’”
ALL: “Aye”
CHAIR: “Carried”

 

[Centurions]

That's the allegation of non-cooperation, yes, but they haven't included any other allegations after 2018 which means either i) all the club's alleged naughty business had finished by then (which doesn't make much sense) or ii) they didn't look at records after 2018 (which doesn't make much sense either tbh).

Still, I gave up trying to make sense of what the PL does last February.

I thought ii) was obvious but that may just be me ;)

They'd have been having to amend the charges year on year otherwise which is why I do have a slight concern on what happens with 2018 onwards if we are found guilty of anything besides non-cooperation.

 

[cheekybids]

PL BOARD MEETING MINUTES. Wednesday 10 April 2024.
CHAIR: “What the fuck are we doing?”
CEO: “No bloody idea.”
DIRECTOR 1: “Me neither”
DIRECTOR 2: “Nope”
CHAIR: “Anybody?”
ALL: Silence
CHAIR: “The resolution is that we have no fucking idea what we are doing. All those in favour say ‘Aye’”
ALL: “Aye”
CHAIR: “Carried”

All: whatabout city?

 

[Coatigan]

Speculation only: I still don’t really understand why we gave them nothing beyond 2018; perhaps for this reason?

I assume because the investigation was for the der spiegel allegations. It opened when uefa opened theirs, and once cas concluded it, there was no logic in the PL just carrying on investigating every year thereafter indefinitely.

It was a fair stance imo. They will argue that's failure to cooperate, but the club would probably argue the need to cooperate beyond what was being investigated, without a definitive end in sight.

 

[WRicko]

You're on the right lines I believe. Fordham was about bringing revenue in via an up-front lump sum, rather than tax avoidance, and my view is that was done to try to help us avoid sanction under FFP.

Although we knew we were going to fail, the Annex XI provision about pre-2010 wages gave us a get-out if we could show that these wages were the sole reason for our losses. Knowing what those allowable wages were, we knew what the maximum allowable loss was, and the Fordham payment was (in my view) a device to help us achieve that.

Of course, as we now know, UEFA made a change to the method of calculation about those wages and how they could be applied, which made us fall just outside the maximum allowable loss. I suspect that we probably wouldn't have bothered with the Fordham arrangement had we known the way it would play out but it was too late once we did know.

Image rights are certainly a device to minimise tax payments, by paying a player's company for the use of their image. The tax burden then falls on the player's company, rather than the club. If the club pays a player £100k a week, with no image rights, the club will pay tax & NI on that full £100k. By paying £90k in salary and £10k in images rights, the club reduces its tax & NI liability by £10k. HMRC's rule of thumb is that, under normal circumstances, 10% of a player's remuneration is acceptable. I suspect the disputes with the likes of united and Newcastle are over the amounts paid, and therefore their tax liability.

I have never really understood the change that was made it never made any sense to me can you please explain