As Rangers enter administration, tax probes are launched into EIGHT top English clubs



Rangers may not be the only major footballing force to hit financial meltdown, after it emerged that tax probes had been launched into eight top English clubs.

It is believed the official investigations into current and former Premier League sides could potentially involve hundreds of millions of pounds.

Emotions riding high: A message is scrawled on a Rangers shirt tied to the Ibrox gates

Backlash: A Rangers fan shows his anger towards Craig Whyte on Wednesday

What is the tax scam that has left Rangers on the brink? One of the reasons why Rangers fell into administration is the probe by Her Majesty’s Revenue & Customs into the use of Employee Benefit Trusts - a complex tax avoidance scheme.

The Scottish giants are understood to have used EBTs for the decade leading up to Craig Whyte taking over the club last year.

EBTs were until recently considered an efficient way of reducing tax – but companies with disputed EBT issues had to settle them by December 31 last year.

Companies pay into a trust, which loans the money to the employee for benefits. Examples of these benefits are pensions or the purchase of shares. The money is never meant to be repaid.

EBTs allowed foreign players to have their wages paid into a trust, withdrawing the money when they were no longer living in Britain - and therefore avoiding the top 50 per cent rate of UK tax. They have now been declared illegal. HMRC claim Rangers’ previous owners used EBTs to avoid paying millions of pounds in tax and National Insurance on the player payroll.

It has been a shocking week for Scottish football, with Rangers plunged into administration over an alleged £9million owed to HM Revenue & Customs.

They are also facing another potential bill of more than £70m after an ongoing inquiry into the use of Employment Benefit Trusts, which are often seen as ways of avoiding tax.

The taxman has declared that illegal — and claims the club's previous owners used the trusts to avoid paying millions of pounds in tax and National Insurance on the player payroll.

Football finance expert Dr Chris Brady said: 'Rangers may be the tip of the iceberg. EBTs became popular with clubs as a means of reducing crippling wage bills.



'We believe at least eight current or former Premier League clubs are being investigated.'

The administrators held talks with the Scottish Government on Wednesday as they began the process of trying to sort the club's finances.



Officials from Duff and Phelps spoke to Scottish sports minister Shona Robison a day after being appointed by the club.



Robison said: 'In a telephone conversation this morning with the administrator, I explained that we want to see an outcome in the best interests of Rangers staff, supporters and the game of football in Scotland as a whole, whilst enabling the club to meet its obligations.



'A key concern for us is the future of those employed by the club and the potential economic impact of administration. The Government stands ready to offer assistance to anyone affected by implications for jobs and we will stay in contact with the administrator throughout the process to ensure we are informed of any developments.'



Rangers boss Ally McCoist summed up the feelings of all Rangers fans on Tuesday, when he said: There's no getting away from it. It has been a very disappointing and black day.

'We have 140 years of fantastic history, but the most important thing is that we look to the future and the next 140 years.



'Going into administration obviously wasn't ideal, but it's the opinion of many people that it might be the best thing.'

He also asked fans to continue backing the club in these troubled times. 'The most important people at this football club have always been the fans and that will always be the case,' he said.

Crunch time: Rangers' director of football Gordon Smith leaves Ibrox on Wednesday

'They are suffering at the moment and I am one myself. I have supported the club all my life and I know how they are feeling.

'The one thing that I have to ask them at this time for the club is to be with the club and with the team. The team really need the support of the fans more than ever in this hour.

'It's always been the case that we have had a wonderful relationship with the fans and I firmly believe that they are the best in the world. Now we need them and we have to ask them to prove that again by supporting the team in numbers and I am sure they will do that.

'They understand that it is not an ideal situation. We have been deducted ten points and that makes life very, very difficult for us. But these are the facts and I would just ask the fans for their continued great support and to please get behind the team.'

The 10 points that Rangers will be deducted means Celtic are now 14 points clear in the SPL. It is clear that Rangers face more pressing issues however.

Dark days: Police patrol outside Ibrox on Wednesday Tough times: Rangers face a fight to save their future amid administration

Paul Clark of administrators Duff and Phelps believes Rangers can emerge in better shape from the process.

He told Rangers TV: 'We will be conducting regular meetings with the staff and, wherever we can, will keep giving messages to the fans who we know have an interest in the work that we are doing.

'I can't give any firm commitment but certainly over the next day or two we hope to get control of the finances of the club and to better understand what we need to do in the coming days and weeks.



'The club had been in such a period of uncertainty that the administration will actually relieve that uncertainty and start to build the future.'

Former Rangers midfielder Trevor Steven has said he believes owner Craig Whyte's presence at Ibrox will be untenable once the outcome of the administration process becomes clear.

Rangers supporters are asking serious questions of Whyte, who bought out Sir David Murray for £1 but pledged to settle Lloyds Banking Group's £18m debt and invest in the playing squad and stadium.

Owner: Craig Whyte outside Ibrox earlier this week

Earlier this month, Whyte admitted he had accessed cash from loan company Ticketus after reports claimed he had borrowed £24m on future season ticket sales.

The main issues over alleged unpaid tax have arisen from before Whyte took over. But Steven still feels the relationship between the fans and Whyte, who flew out of Glasgow Airport on Tuesday night, cannot be mended.

'I don't think there has ever been a good relationship between Craig Whyte and the support,' he said.

'For me, there has always been smoke and mirrors since he came in. He came with a handful of promises that have never been delivered.

'That's what really aggravates the Rangers support, they have never been able to trust the man in charge and there has been no transparency.

'The fact that he has gone off to Monaco is not particularly what the supporters want to hear.'

Champions: Rangers won the title for the 54th time last season

Rangers have won 54 titles in their illustrious history. Along with Glasgow rivals Celtic, they have dominated north of the border, with one of them winning the title every year since Sir Alex Ferguson's Aberdeen finished top of the pile in 1985.