Tax, rules, Juninho and EBTs


The SPL yesterday released a statement concerning the Employee Benefit Trust payment Celtic made in 2005 to Juninho, in response to what sounded like unfounded allegations made earlier this week.

The league noted, “we have seen reports regarding an EBT in relation to a former player of Celtic FC.  The SPL has investigated the arrangements and documentation in that case and has determined that there is no evidence of any breach of SPL Rules”.

Many good employers have understood the benefit of assisting individual members of staff during times of crisis or personal hardship.  One very practical way of doing this is to lend them money, which happens in businesses up and down the country every day.  When the nature of these transactions involve either a company of sufficient size, a lengthy repayment period, or a high value loan, a formal structure is needed to establish the terms of the transaction, not only for the benefit of employer and employee, but also for the tax authorities – who authorise tax-free payments of this kind.

These tax rules were not established to allow wealthy individuals to escape their social duty.

Not long after Rangers first operated an Employee Benefit Trust Celtic were approached and offered consultancy to establish a similar scheme.  The promised benefits were huge, vast quantities of cash would no longer go to HMRC and would be freed up to spend on new players.

Celtic were not convinced.

Loans would need to be repaid and if not, contractually binding transactions would need to be documented in accordance with SPL and SFA rules, and this very documentation would make them liable for tax.  For Celtic, EBTs could only be used in limited circumstances, would be unable to deliver a significant impact on the business, and would introduce a further layer of professional costs.

“How can these work?” That was the question. How on earth can a club pay millions of pounds into a Trust none of which is contractual? Players, and their agents, like to have things written down. If you write it down and inform the authorities, you’re taxed on it. Celtic were not prepared to enter any written agreement and not declare it to their auditors, HMRC or the football authorities.

What was the cost of this principled stance?

In season 2004-05 former World Cup winner, Juninho, arrived at Celtic from Middlesbrough on a straightforward contract, his only contract with the club, which was correctly registered with the football authorities.  He only lasted eight months before agreeing to terminate his deal.  Celtic made a payment of around £750k into an EBT the player had from before his time at the club.

Celtic informed HMRC of the details of their EBT transaction with Juninho and were told this was regarded as income, not a loan, and that they would need to pay tax.  Celtic then paid tax due on top of the £750k which went to Juninho.  It was a pointless and expensive exercise for Celtic, but they dealt with it honestly and openly.

The club’s understandings of EBTs from five years earlier were confirmed, this was not a way to avoid taxation by filtering part of a player’s income away from PAYE.  Board members of any other club which understood how to make this work were clearly a lot smarter than our guys.  They were also able to buy players and win leagues while our board were hammered daily for their prudent values.

I bet directors at that other club are sounding pretty contrite now, humbled by the emerging news. There will be no self-serving vainglorious rabble rousing.

Far from Celtic being subject to criticism on this matter, scrutiny of their actions will only reveal the stark cost of following the rules when others don’t.

Congratulations to the campaigners who for 23 years sought Justice for the 96.  We all watch the game in a safer environment because of the loss endured by the families bereaved at Hillsborough.  Yesterday’s report condemns the actions of many: some senior police officers, sections of the media, one or two of who should never work in the industry again, and a former MP, whose actions were truly appalling, and who remains a knight of the realm, but those running the game, those responsible for Health and Safety standards, and various governments have a responsibility to bear.

Dangerous crushing inside and outside football grounds was a fact of life in the 1980s, including at the Janefield St entrance to Celtic Park.

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  1. Why were Sevco 5088 invited to a session of the SPL’s independent inquiry into Rangers(IA) dual contracts??

  2. In tne tradition of ranker’s duplicitous doublethink and general vainglorious pronouncements, the blooterers at the newly created behemoth, “T’rankers”, have stated that a 5 yr. signed contract is in reality a 5 yr. verbal pledge, thus throwing Scottish Law into the bin with their imaginary past.


    The heading on all future correspondence from the mighty muppets shall henceforth read :


    ” Verbal agreements? Not worth the paper they’re printed on. ”


    Ah….Green & McCoist appearing in a panto on a pier very very soon.

  3. I love the stupid huns desperate attempts to drag us down the same road as them.



    When they were liquidated, apparently this had happened to us in the 1990’s. Eeeehhhhh…. NO!



    When the EBT enquiry was announced they slabbered about Juninho. Once again, Eeeehhhhh…. NO!



    They are the gift that keeps on giving and we have only scratched the surface of the pain and suffering that lies in store for them.

  4. I was under the understanding that verbal agreements were contractually binding in Scots law (I seem to recall a court case that hinged on this recently but I may well have this completely about face). Can someone set me straight on this?

  5. .



    G’Day CQN..



    I Have been truly Saddened by The Justice fo the 96 News..



    It was Not well reported in Australia but l read a BBC article some of which l never knew..



    The Hillsborough Year l Followed Manchester United..Well Brian McClair really..(From Devon Torquay) went in a Van every Friday Night some great Times (Seen the English Hooligans for what they were)..



    I Watched Hillsborough with My Dad Live in our Local in Notting hill Gate..



    3years Earlier..I Was Hitch Hiking back to Glasgow from Crete..I lived just outside Hania near Heraklion (Where My Bhoy Georgious was born)..



    Stuck at Ostende ferry terminal for over a Day l woke up to the Sight of a Number of Celtic buses coming of the Ferry…Celtic MUST be in a European Final i thought since it was May..


    I asked one of the Bus Drivers where all the Celtic fans were Going..He told me What had happened with Celtic and Rapid Vienna and Celtic fans were going to Support Everton in the European Cup Winners Cup Final (See what l did there)..



    Nek Minnut (See Kiwi Slang)..l hitched a lift to Rotterdam..a Place l would Move to and Love Years later..



    Met a Crowd of Scousers at a Cafe and Ended up Spending the Day with them as l Knew one of their Mates in Torquay..



    To Cut a very Long story Short..Everton Obviously Won the Cup..The Scouse Gentlemen that Took me and Celtic to their hearts were great and Offered to take me to Liverpool on teir Coach..



    After a Couple too many After match drinks We Walked to the Coach to see it Drive away leaving us in Holland..11 of Us..



    We Split up and l asked a 67 yr old Scouser (Who’s Son in Law was the Bus Organiser) after trying to get on a Couple of Ferrys l suggested we go to the Dutch Police and ask them to Deport up (Legally)..



    They did this and l Got the Olde fellow back to Liverpool..God know what he Done/Said to his Son in Law..



    Now to the Reason l have Ranted on about this…



    Six days later Liverpool FC played Juventus FC in The Heysel Stadium..this was Six days after the De Kuip Final in Rotterdam but with SUPPORTERS from the Same city who were praised for their behaviour in Holland..



    Heysel another Disaster..that Liverpool Supporters were Given most of the Blame..One thing l remember Vividly from that Night was a Juventus Supporters Lay Dying on the Terraces and on the Pitch..Minutes late the Juventus fans Produced a Banner which read..in English…LIVERPOOL SCUM..






    Maybe Justice for Heysel..should be Next..







  6. Saturday



    Do we start with Watt and Hooper up front? The two new boys together? Hooper and Lassad? Hooper and Miku?



    Go F*** it and play all Four up there!



    Hoopy Days bhoys, Hoopy Days…

  7. Back in the group stage after a four-year absence, Celtic FC could emerge as a surprise package if, as Alex O’Henley suggests, they can continue their improving away form, starting in Lisbon.



    The mere mention of Lisbon is enough to get everyone connected with Celtic FC excited. After all, this is the city where they made history on 25 May 1967, when Jock Stein’s side became the first British team to lift the European Cup following a 2-1 victory against FC Internazionale Milano at Lisbon’s Estádio Nacional.



    Celtic supporters need little excuse to make a pilgrimage to the scene of their greatest triumph and after a four-year absence from the group stage, the presence of SL Benfica alongside FC Barcelona and FC Spartak Moskva in Group G will be viewed by the supporters as an added bonus to being back among Europe’s elite.



    What they can achieve in this season’s competition, Celtic’s 50th European campaign, is another matter altogether. As fourth seeds, Neil Lennon’s side are realistically competing for third place; anything more would be seen as punching above their weight.



    Captain Scott Brown and striker Giorgos Samaras are the only survivors from Celtic’s last outing in the competition, so Lennon’s newly assembled team, featuring emerging talents like winger James Forrest, will need to hit the ground running when they host Benfica on Wednesday.



    Traditionally, Celtic Park has been something of a fortress on UEFA Champions League nights, with the Glasgow outfit suffering just two defeats in 18 group stage matches. Having featured in many of them, Lennon and his assistant, Johan Mjallby, know only too well how much the crowd can influence these occasions. If Lennon can impart that knowledge and harness it to an increasing sure footedness away from home, Celtic could emerge as a surprise package.



    However, 45 years after the club’s finest hour-and-a-half, Celtic are relieved to be back at Europe’s top table surrounded by old friends such as Eusébio’s Benfica. The Eagles icon has painful memories of playing at Celtic Park, Benfica having lost 3-0 in 1969. They went out of the European Cup on the toss of a coin after the first leg had finished with the same scoreline. A similar rub of the green would suit Lennon nicely next week

  8. Off topic (what’s new) for a minute, then I’l depart.


    Libraries. Great resources. Always loved them. They gotta stop closing them.


    Where I live, there’s a brilliant library which will order up dvd boxsets for you. Great when you can’t afford to keep buying them….or don’t particularly want to own them.


    So, today I got Season3 of ‘ In Treatment ‘. Gabriel Byrne is a brilliant actor…..not always had the best roles….but who can forget his performance in ‘ The Usual Suspects ‘.


    Anyway…..’ In Treatment ‘ is compelling. A psychologist and his sessions with patients.


    Who’d think that would be riveting? Fly on the wall? Voyeurism, even. Whatever, it’s fascinating entertainment.


    I’ll leave yez in peace now.


    HH !

  9. Sports Law Expert Tells RangersMedia SPL Titles Can’t Be Removed


    Details Published on Thursday, 13 September 2012 02:09 Written by DarcheVinny


    A top sports lawyer – who wishes to remain ANONYMOUS – has told RangersMedia that the SPL will not be able to strip titles, regardless of the findings of their ‘independent’ commission.



    The first meeting of the ‘independent’ commission was held earlier this week and will continue until November at least.



    Rangers were not represented at the first meeting and CEO Charles Green has stated that the SPL’s investigation is a ‘Mickey Mouse Event’ and Rangers will not be represented at any meetings. Mr Green also stated that the SPL would be faced with legal action if they attempted to remove any of Rangers fairly won SPL titles.



    RangersMedia’s new England based top legal source had this to say:



    “I don’t think it is within the SPL’s powers and I don’t see a clear legal route for them to take. Mr Green is right, there is no jurisdiction over the current activities of his company as they are a member of the SFL and not the SPL.



    It is true that, if you are not a member of a sporting organisation, you are not subject to its rules. Mr Green is correct that the SPL is not the current governing body of the club, the SFL and SFA are.



    The SPL are barmy to even try and remove these fairly won titles.”



    So there you have it. A top sports lawyer based in England – who wishes to remain ANONYMOUS – has told RangersMedia that the SPL are barmy to try and remove titles from Rangers.



    I guess that’s the case settled then. Thankyou for your help Mr Anonymous Top-Sports-Lawyer.





    I guess that’s the case settled then. Thankyou for your help Mr Anonymous Top-Sports-Lawyer.



    Is the above last 2 sentences, Rangers fans rippin the wee from themselves?


    Looks like they are posting tripe and rippin it all in the same article. I love it!!

  10. Summa of Sammi



    I remember watching the game and the events that unfolded.



    The one thing that stuck in my mind was a Juve supporter taunting the Liverpool fans from the trackside, his face was covered and it looked like he had a hand gun.



    Not a single polis went near him.

  11. Celtic have recorded nine wins and one draw from ten home matches against Portuguese opponents.



    Remember that before placing your bets next week.

  12. Sorry…..I just gotta have my tuppence worth : from ‘celticlegends’ link – I’d tend to think that the manky ones’ ‘anonymous’ sports lawyer will soon be outed as none other than one G. di Stefano…..the pronouncemnts have his stamp all over them.


    I really will get tae now!


    HH !

  13. macjay1 for Neil Lennon on

    Summa of Sammi….


    13:32 on


    13 September, 2012



    Thanks for sharing your memories of those days.


    First hand accounts are always the best.

  14. I agree that Rangers should not have any of their “fairly won titles” stripped.



    It’s the other ones we’re concerned about.

  15. RalphWaldoEllison fights ALS on




    Once again thanks.



    Nailing issues like this will never catch on in the MSM you know.



    In those darker days we were all led (by a compliant media) to believe that R****** relative success was as a direct result of superior business acumen, better players, better coaching and the Murray millions being injected into the club.



    Now we know the millions were flowing in the opposite direction. Fans & tax payers money going to Murray, his henchmen & scores of players in secret deals.



    In those dark days too, some of us looked around Celtic Park, saw the big crowds, compared things to across the city, & came to the conclusion that our own fans victory in 94 was a hollow one. We blamed unambitious directors with a biscuit tin mentality for our failure to keep pace with them.



    We were all the victims of a swindle & a cover up.



    But that seems so much less important today after the truth begins to emerge about that terrible day in 1989.




  16. TET@13:55



    ‘The one thing that stuck in my mind was a Juve supporter taunting the Liverpool fans from the trackside, his face was covered and it looked like he had a hand gun’



    You are indeed correct. It was later identified as a starting pistol. The events before + after the EC Final of 1984 were primarily responsible for the horror of Heysel

  17. saltires en sevilla on

    No Bobby Does It Petta


    12:32 on


    13 September, 2012


    So a few moronic currants rant on SSB about the ‘janeenyo ebt’, and the SPL duly conduct an investigation jig time?





    In fairness SFA response was, in all likelihood, pressed by Celtic. To close down lingering deflection & hunguffery.



    The statement is clear enough: -Celtic agreed to make a severance payment to Junhino to terminate his contract early. SFA had a copy of that contract in (the only one in existence) as per the rules.



    Celtic agreed to pay the severance into an EBT already set up for the player from his Middlesboro’ days….however, they also took advice from HMRC (as you do) to check if the payment was liable to income tax and NIC payments. HMRC confirmed to Celtic payment was liable for tax and Celtic paid the (income) tax and National Insurance Contributions to meet with requirements. A costly business for the club.



    Clean as a bell!



    Rankers, on the other hand, are alleged to have operated a dual-contract system -not declared to the SPL or SFA -in breach of the rules. They also continued to pay money into EBT scheme for best part of 12 years. Clearly HMRC had offered Celtic different advice to Rankers ..or… they offered the same advice and it was ignored …or, Rankers never asked for advice at any point.



    either way…



    1. HMRC are after Rankers for non-payment of said tax, interest and penalties – and we await the outcome of the tribunal in due course (with baited breath)



    2. The Nimmo review of dual-contracts has been delayed until November 2012. Methinks Nimmo et al, already know (and advised) on the outcome. The ‘delay’ is to allow SFA, SPL, National security and NATO to clear the decks, batten down hatches, man the lifeboats and generally prepare for the worst, when the decision to remove tainted titles is published.




  18. 67Heaven ... I am Neil Lennon..!!.. Ibrox belongs to the creditors on

    We COULD now be entering bhun ‘Armageddon Alley’………TICK TOCK …..!!!!



    Where are my sedatives…??

  19. Ten Men



    I never knew they caught the bloke.



    The powers that be really need to take a good look at themselfs over the way football was regulated, treated like scum then and still the same.



    I was at ibrox the day 66 lost their lifes, my parents were beside themselfs with worry, they didn’t have a clue who had perrished that day.



    Point is, 20 years later, supporters were still being treated the same.

  20. TET..



    I watched the Heysel game back in Torquay with Mostly Scouse mates about 6 of whom had been in De Kuip Stadde Not with me..But most said the Same that the Atmosphere pre and Post game was Amazing the Same thing the Dutch Police said to me and My Olde friend..



    I am Not trying to take anything away from Justice for the 96..But l have Always felt Strongly about this..



    The Everton Vs Rapid Vienna Game (Plus Circa 5,000 Celtic Supporters is Probably my best Ever Celtic Experience )..And Celtic were NOT even Playing..But the Green Brigades Dad’s and Granddads were there..:O))))))



    Summa of SupportersCSC

  21. Jelly and Gelato,



    No problems. It is just my interpretation mind. The key components of the rule are the “payments” part (payments as distinguished from loans), “made to a player” “in relation to footballing activities” and “contained in a contract of service” part.



    Definition of”payments” is dealt with in the earlier post. Juninho’s severance, made through the EBT, was in my opinion a “payment”, not a loan.



    “made to a player” Rangers/Celtic might seek to argue that the payments were made to a trust, not to a player. However, the sole beneficiary of each sub-trust seems to be the player, and if a side contract exists which states the player will be entitled to loans at certain times, and with a guarantee from the club that the loans will never need to be repaid, then that will probably be enough to satisfy the commission that the payments were made “to a player”. Juninho’s severance was, in my opinion, made to him for the purposes of the SPL’s inquiry. Note that there is no side contract for Juninho.



    “in connection with footballing activities” Payments made through EBTs were almost certainly paid in respect of footballing activities in the Rangers and Juninho cases. It is exceedingly unlikely that Celtic paid Juninho £2.4 million for anything other than his footballing activities, whether rendered, anticipated or in lieu thereof. Notwithstanding that part of his payment was made as a severance, his payments were all, in my opinion, made in respect of footballing activities, albeit part of his payments was in lieu of (greater) payments otherwise due to him in his contract of service.



    “contained in a contract of service” This is where Juninho and Rangers differ. The amount of cash celtic gave Juninho was presaged in his contract of service. Celtic said they would pay him £4million, they paid him £2.4million. The fact that all, none, or part of this money was paid to him via an EBT is neither here nor there, for the SPL’s purposes anyway. Rangers get into problems here because, firstly, they seem to have paid players in certain instances greater sums than are presaged in their submitted contracts, and secondly because they seem to have guaranteed when payments will be made (all triggered by footballing activities, it appears) and also underwriting the behaviour of the trustees regarding issuing the loans and neglecting to ever re-coup them. This points to a contractual mechansim securing payments to players from the club which operated entirely (and, it seems, deliberately) out-with the compass of their submitted contracts of service.



    That’s the difference, that last bit.

  22. celticlegends



    13:30 on 13 September, 2012



    ‘Has anybody read this on their site. Hilarious


    They are now making up things as they go along’




    I may be wrong but I had assumed that that article was supposed to be a parody of a Daily Record article that quoted an anonymous legal expert saying the huns could be stripped of titles.

  23. Shieldmuir Celtic on

    Thanks ,Paul for clarifying the Juninho/E.B.T. issue again. However, as we know,’there are none so blind as those who will not see.’ Charles Green and some of the Scottish football media must come into this category. I wonder if this panic reaction has anything to do with officialdom’s net tightening on them?

  24. theweegreenman



    They use the foam in all the league games in Chile, it seems to work.



    At the start the reffs booked those who encroached, stopped it quick enough.

  25. No Bobby Does It Petta on




    It also possible that certain peepul at the SFA were bustin to dig up some dirt on those pesky tims.

  26. celticlegends, 13:30


    That article is true – they can’t strip the titles from Greens Newco (as they don’t have them to start with as they are a Newco).

  27. traditionalist88 on




    Nice one – thats too long for a hun to read and/or understand right enough, if we can just condense it to about two lines they may just have to question their entire belief system:)




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