Supreme court back HMRC over tax avoidance scheme at Rangers.

The Supreme Court has ruled in favour of Her Majesty's Revenue and Customs following a long-running dispute over a tax avoidance scheme run by Rangers Football Club.

Lord Hodge announced in court that five Supreme Court judges had unanimously dismissed an appeal by the liquidators of RFC2012, the company formerly known as Rangers Football Club before its financial collapse in 2012.

HMRC had lost two earlier tribunal hearings over the Employee Benefit Trust scheme before a ruling in their favour in the Court of Session in Edinburgh in November 2015

Former Rangers chairman Sir David Murray expressed his disappointment with the verdict.

In a statement Sir David said: "I am hugely disappointed that the Supreme Court has upheld the decision of the Court of Session, reversing the decisions of the specialist tax First Tier Tribunal and the Upper Tribunal in this matter.

"The decision runs counter to the legal advice which was consistently provided to Rangers Football Club, that on the basis of the law and legal precedent at the time, the contributions made to the trust were not earnings and should not be taxed as such.

"It should be emphasised that there have been no allegations made by HMRC or any of the courts that the club was involved in tax evasion, which is a criminal offence.

"The decision will be greeted with dismay by the ordinary creditors of the club, many of which are small businesses, who will now receive a much lower distribution in the liquidation of the club, which occurred during the ownership of Craig Whyte, than may otherwise have been the case.

"I have not had the opportunity to discuss the decision in detail with Tax Counsel, but will do so, particularly in light of proposed legislation, which will alter the tax position applying to loans made by trusts to employees. Once the impact has been assessed, a further statement will be issued.'

A statement by Celtic read: "We note today's decision by the Supreme Court. Celtic's position on this issue has been consistent - that this has always been a matter for the courts of law and also the Scottish football authorities, whose rules are intended to uphold sporting integrity.

"In 2013, we expressed surprise - shared by many observers and supporters of the game - over the findings of the SPL commission that no competitive or sporting advantage had resulted. Today's decision only re-affirms that view.

"We are sure now that the footballing authorities in Scotland will wish to review this matter. Celtic awaits the outcome of their review.''

The Scottish Professional Football League, which assumed control of the top flight following a merger in June 2013, had earlier issued a brief statement on the matter.

A spokesman said: "The board of the SPFL notes today's judgement of the Supreme Court. We will now take time to examine the judgement in detail and to consider any implications for the SPFL.'' The Scottish Football Association dropped its investigation into the matter days after starting one, when the SPL took on the case in 2012

And the SFA quickly ruled out any disciplinary action after seeking legal advice.

A statement read: "In light of the Inner House of the Court of Session decision, the board of the Scottish FA sought external senior counsel opinion to ensure a robust and independent consideration of all implications of today's judgment.

"The board received written advice from senior counsel, amplified when the QC attended a full meeting of the board to discuss his conclusions.

"Specifically, senior counsel was asked to anticipate whether a determination in favour of HMRC, as announced today, could imply that there had been a breach of the Scottish FA's disciplinary rules as they applied at the time of the EBT payments.

"The clear opinion of senior counsel is that there is a very limited chance of the Scottish FA succeeding in relation to any complaint regarding this matter and that, even if successful, any sanctions available to a judicial panel would also be limited in their scope.

"Accordingly, having had time to consider the opinion from senior counsel, and having examined the judgment of the UK Supreme Court, the board has determined that no further disciplinary action should be taken by the Scottish FA at this time.'

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