Hearts have announced a resolution has been agreed with Her Majesty's Revenue and Customs in a dispute over tax and national insurance contributions.
The £1.75million dispute was revealed in the share issue brochure as Hearts launched a scheme to raise £1.79m at the end of October.
Now Hearts have come to an agreement to pay £1.5m over a three-year period.
The deal is separate to the settlement of a £450,000 bill yesterday which staved off the threat of a winding-up order.
The dispute related to players loaned to Hearts from Lithuanian club Kaunas. Hearts majority shareholder Vladimir Romanov is a Lithuania-based Russian businessman who also has control of Kaunas.
Hearts' share issue brochure revealed HMRC "claimed unpaid tax liabilities of circa £1.75 million (excluding interest and penalties) in relation to the arrangements between the company (Hearts) and Kaunas FC in relation to certain players who were loaned to the company by Kaunas FC".
The "burden of proof" was on Hearts, who announced no penalties are payable under the terms of the agreement and that the tax tribunal hearing scheduled for last month has been concluded without any evidence being heard.
In a statement on the club's official website, Hearts director Sergejus Fedotovas said: "We are satisfied that this resolution provides the club with an opportunity to now move forward with certainty.
"We believe that the payment terms agreed with HMRC allow the club to manage repayments in a way that will not be detrimental to longer-term development of the club."
The Hearts statement added: "The final settlement figure is lower than the amount assessed by HMRC of £1.75m, excluding interest and penalties, (as stated in the club's share issue brochure) and brings to an end a contingent liability that has been highlighted in the club's annual accounts since 2009."
Hearts have raised more than £600,000 since the share issue scheme was launched, with Fedotovas, right-hand man to Romanov, calling for further support.
The capital club, whose defence of the William Hill Scottish Cup ended in a fourth-round loss at city rivals Hibernian on Sunday, face a £2m shortfall in revenue this season.
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