Former Premier League Chairman Claims Tax Authorities Investigating Manchester City Over £900M Rule Breach
The tax authorities are intensifying scrutiny on Manchester City following its breach of financial regulations amounting to £900million, as reported by a former chairman of another Premier League club.
The HMRC’s risk and intelligence service is currently collecting data that could prompt an extensive investigation into the club’s troubled financial statements.
The officials in charge of probing tax avoidance, evasion, and fraud are expected to evaluate whether Manchester City has outstanding tax liabilities, including VAT, as suggested by insider information.
The former chairman commented: “The HMRC has maintained close observation of the football industry over the years and has noted the circumstances surrounding Manchester City, readying for a possible escalation in their response towards the club.”
“They are conducting an ‘intelligence project’ to gather evidence.”
“It would be highly irresponsible for HMRC not to look into the club’s operations.”
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Manchester City was found guilty by an independent commission for transgressing financial regulations by disguising £900million in fictitious transactions over a time span of nine years.
The club has refuted any allegations of misconduct and has mounted an appeal; nonetheless, HMRC is reportedly ready to take action, potentially resulting in significant fines and reparations for the club.
Investigators are focusing on multiple factors, including overseas payments, discrepancies in image rights transactions, and payments to players, agents, and managers, including ex-coach Roberto Mancini.
The former Premier League chairman noted: “The HMRC must have already scrutinized what Mancini and other staff have disclosed on their tax filings in order to detect potential tax fraud or evasion.”
Tax expert Dan Neidle, who previously worked with law firm Clifford Chance, estimates that the club likely owes around £12million in taxes attributed to payments received by former manager Mancini.
He indicated that Manchester City could face punitive measures of up to £24million for undisclosed payments made to their former manager.
His analysis suggests, “There appear to be substantial grounds for commencing a criminal investigation.”
HMRC has opted not to comment, and Manchester City has also been approached for a response.