None of that changes the fact that many companies chose to settle EBT liabilities under the EBTSO process. Following the Rangers case, settlements rose to £1.7 billion from over 1,500 companies . All sorts of claims have been made about who offered what to settle. I have yet to see any reliable evidence to support them. HMRC rarely publicises how settlements are reached. That was also my experience with them when I worked.
In any event, the argument that players were paid to play football but not pay tax because the payments were only “loans” always struck me as perverse and unfair to everyone else who does pay tax on what they earn from their jobs. HMRC took Aberdeen Asset Managers to court several years before Rangers and won because of their abuse of EBTs. AAM wouldn’t settle either. And that was before the 2010 legislation clarified the legal position.
I agree with those that say it was unfair to make the legislation retrospective. But in all honesty I can’t disagree with the principle that footballers, or any other employee for that matter, should pay tax on what they earn. So I also agree that HMRC were right to tax and penalise those who made untaxed income out of artificial film rights schemes - including many from the east end.
The principle of people “optimising” their tax payments is a tricky one - there is an entire industry, a very respected industry at that, built around helping people legally avoid paying more tax than is absolutely necessary.
The irony being that the more you earn to start with, the better the advice available to you is and the less tax you end up paying.
Footballers being paid tens of thousands of pounds per week will always be given this advice; independent contractors make use of having companies in their wife/husband/children’s names to exploit tax allowances and the market of cash payments is rife in tax avoidance.
I know of several Celtic supporters who have personally gained from their employers participating in tax avoidance/optimisation schemes and who were glad to receive that advice and the outcome of playing less tax.
Needless to say, they wanted Rangers scorched from the earth for doing the same.
From the outside, the world of tax and tax advice is a bit of a game of cat & mouse where loopholes are identified, vehicles to legally export these created and used and then HMRC get wise to it and round to closing them.
The trick would be to not get yourself in up to your neck in any particular scheme; it’s about risk management if you are an employer using these schemes.
The Risk Management at Ibrox was an utter shambles and appears to have ignored that the EBTSO process was in place and should be a signal to stop and find another means.