Hearts issue dire warning over winding-up order

 

Hearts have warned fans the club might not survive until the end of the month after being hit with a winding-up order over a tax bill of almost £450,000.

The Clydesdale Bank Premier League club issued a plea for "emergency backing" after confirming action by Her Majesty's Revenue and Customs at the Court of Session in Edinburgh.

Hearts said they were attempting to negotiate a payment plan with the tax authority over the matter, which is unrelated to a £1.75million HMRC bill the club are challenging at a tax tribunal.

But they later asked supporters to find the money to see the club through the crisis in an appeal described as "not so much a request as a necessity".

Hearts urged supporters to buy tickets for forthcoming home matches and invest in a recently-launched share issue.

The board statement added: "Without the support of fans there is, as we issue this note, a real risk that Heart of Midlothian Football Club could possibly play its last game next Saturday, 17 November, against St Mirren.

"This isn't a bluff, this isn't scaremongering, this is reality."

New SPL rules introduced in the summer would see Hearts face a more stringent punishment than the previous automatic 10-point penalty if they are forced into administration.

The rules state Hearts would be deducted a third of their previous season's tally, rounded up to the nearest whole number. Hearts finished on 52 points last season, which could mean an 18-point deduction in the coming weeks.

It was court action by HMRC that forced Rangers into administration in February.

The statement added: "Without your help now, we could be entering the final days of the club's existence.

"There are limited options for the board of directors to take to avoid the catastrophic consequences that a funding shortfall would mean for the club.

"In a footballing sense alone Hearts will suffer an immediate 17-point (sic) penalty.

"This would just be the start of a painful process that will affect every one of us and could lead to far more damaging actions that threaten the very existence of the club."

Hearts earlier said they were "endeavouring to agree a suitable payment plan with HMRC for the outstanding amount of £449,692.04" and that the petition had only recently been presented.

A club spokesperson added: "We have guaranteed future revenues from forthcoming games and related broadcast income as well as additional guaranteed transfer income which will more than cover the outstanding amount stated in this petition.

"We would therefore be hopeful that HMRC will accept that winding up the club would be totally unnecessary."

But the tone became significantly more desperate in the subsequent statement.

Hearts urged fans to buy tickets for home games against St Mirren, Celtic on November 28 and Aberdeen on December 8.

They also continued their attempts to persuade supporters to sign up for the share offer.

"There are risks, we know, and these are laid out clearly so be very sure this is right for you before committing but please at least consider it," the board said.

"Discussions on whose name is above the door, talk about how the money has been spent and debate on whether the investment in silverware has been appropriate is all natural but quite simply worthless at this moment in time.

"The only valid debate now is how can you help the club. Is the club worth less than £110?"

The board said they would continue to seek the support of parent company UBIG, Vladimir Romanov's investment group, but the club has been moving towards a self-sufficient model.

The Scottish Government pledged to help Hearts find their way through the crisis.

A spokesperson said: "The Scottish Government stands ready to assist in any way it can, including making contact with HMRC if necessary.

"It is in everyone's interests to find a solution which ensures that Hearts can continue in business while also meeting their obligations to the tax authorities."

Hearts launched a £1.79million share issue two weeks ago but the prospectus revealed another tax dispute.

HMRC has claimed unpaid tax liabilities in the region of £1.75million relating to loan agreements for a number of players who joined Hearts from Lithuanian club Kaunas, who were then run by Romanov, the Tynecastle club's majority shareholder since 2005.

Hearts claim the situation was no different to other loan agreements when parent clubs pay some or all of the wages, and will contest the bill at a tribunal this month.

The winding-up order is not the first to be issued to Hearts by HMRC.

The club announced in February they had paid an outstanding tax bill after being given eight days to pay or face being wound up.

Last year, Hearts were forced to pay a bill in the region of £500,000 to defeat a similar order, while others were served in 2009 and 2010.

The club have faced growing problems meeting wage bills in the last 12 months and are currently under an SPL transfer embargo following consecutive late monthly payments to some players and coaches.

This came despite the club reducing their wage costs significantly in the summer with the departure of a number of experienced players.

PA

Have you tried new the Independent Digital Edition apps?
News
i100
Arts and Entertainment
Billie Piper as Brona in Penny Dreadful
tvReview: It’s business as usual in Victorian London. Let’s hope that changes as we get further into the new series spoiler alert
Life and Style
A nurse tends to a recovering patient on a general ward at The Queen Elizabeth Hospital in Birmingham
health
News
science
Arts and Entertainment
No Offence
tvReview: No Offence has characters who are larger than life and yet somehow completely true to life at the same time spoiler alert
News
Chuck Norris pictured in 1996
people
Arts and Entertainment
Sarah Lucas, I SCREAM DADDIO, Installation View, British Pavilion 2015
artWhy Sarah Lucas is the perfect choice to represent British art at the Venice Biennale
News
A voter placing a ballot paper in the box at a polling station
i100
News
people
Arts and Entertainment
The Queen (Kristin Scott Thomas) in The Audience
theatreReview: Stephen Daldry's direction is crisp in perfectly-timed revival
Sport
football
Caption competition
Caption competition
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?

Bleacher Report

Daily Quiz
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

Career Services

Day In a Page

General Election 2015: Ed Miliband's unlikely journey from hapless geek to heart-throb

Miliband's unlikely journey from hapless geek to heart-throb

He was meant to be Labour's biggest handicap - but has become almost an asset
General Election 2015: A guide to the smaller parties, from the the National Health Action Party to the Church of the Militant Elvis Party

On the margins

From Militant Elvis to Women's Equality: a guide to the underdogs standing in the election
Amr Darrag: Ex-Muslim Brotherhood minister in exile still believes Egypt's military regime can be replaced with 'moderate' Islamic rule

'This is the battle of young Egypt for the future of our country'

Ex-Muslim Brotherhood minister Amr Darrag still believes the opposition can rid Egypt of its military regime and replace it with 'moderate' Islamic rule, he tells Robert Fisk
Why patients must rely less on doctors: Improving our own health is the 'blockbuster drug of the century'

Why patients must rely less on doctors

Improving our own health is the 'blockbuster drug of the century'
Sarah Lucas is the perfect artist to represent Britain at the Venice Biennale

Flesh in Venice

Sarah Lucas has filled the British pavilion at the Venice Biennale with slinky cats and casts of her female friends' private parts. It makes you proud to be a woman, says Karen Wright
11 best anti-ageing day creams

11 best anti-ageing day creams

Slow down the ageing process with one of these high-performance, hardworking anti-agers
Juventus 2 Real Madrid 1: Five things we learnt, including Iker Casillas is past it and Carlos Tevez remains effective

Juventus vs Real Madrid

Five things we learnt from the Italian's Champions League first leg win over the Spanish giants
Ashes 2015: Test series looks a lost cause for England... whoever takes over as ECB director of cricket

Ashes series looks a lost cause for England...

Whoever takes over as ECB director of cricket, says Stephen Brenkley
Fishing for votes with Nigel Farage: The Ukip leader shows how he can work an audience as he casts his line to the disaffected of Grimsby

Fishing is on Nigel Farage's mind

Ukip leader casts a line to the disaffected
Who is bombing whom in the Middle East? It's amazing they don't all hit each other

Who is bombing whom in the Middle East?

Robert Fisk untangles the countries and factions
China's influence on fashion: At the top of the game both creatively and commercially

China's influence on fashion

At the top of the game both creatively and commercially
Lord O’Donnell: Former cabinet secretary on the election and life away from the levers of power

The man known as GOD has a reputation for getting the job done

Lord O'Donnell's three principles of rule
Rainbow shades: It's all bright on the night

Rainbow shades

It's all bright on the night
'It was first time I had ever tasted chocolate. I kept a piece, and when Amsterdam was liberated, I gave it to the first Allied soldier I saw'

Bread from heaven

Dutch survivors thank RAF for World War II drop that saved millions
Britain will be 'run for the wealthy and powerful' if Tories retain power - Labour

How 'the Axe' helped Labour

UK will be 'run for the wealthy and powerful' if Tories retain power