The position with HMRC

[TheSlate]

21 minutes ago, Woodley Ram said:

It cannot be the stamp duty on the ground as that would be owed by Mel (the buyer) and not DCFC (the seller). I have no idea the amount owed, but (and I think @Spanishsaid this) it cannot be in the tens of millions. If you take 20% as an average guideline (company tax) then we are talking a maximum of 4-5 Million and I doubt if its anything like that. 

Also is this likely (and I am not ITK) to be an amount that due to Covid etc that we are paying to the HMRC in instalments agreed by them but seen as a breach by the EFL, similar to the company accounts?    

Yeah, agreed. I doubt it is anything like 4-5 million also, mainly because your CT is based on taxable profits for Corporation Tax include the money your company or association makes from:

doing business (‘trading profits’)

investments

selling assets for more than they cost (‘chargeable gains’)

If your company is based in the UK, it pays Corporation Tax on all its profits from the UK and abroad.

- What we don't know is how that 81m was layered on top of p and l. 

[BucksRam]

So to answer your original question @Carl Sagan no-one has a scooby what's going on with this.  

[Ramslad1992]

19 minutes ago, G STAR RAM said:

This is just my opinion though and is not backed up with amy evidence.

 

Can you ask her for the evidence please mate? The people need to know!

[CBRammette]

41 minutes ago, Sparkle said:

Yet one might ask why are other clubs not on the naughty list for that very reason - if it’s good enough for one club it should be all of those doing it or it’s simply a dereliction of duty by the EFL by not having a rule that makes clubs tell them.

Or our debt position with HMRC is different to other clubs who may just have a time to pay arrangement for some PAYE in covid. Have seen nothing to suggest anyone knows anything about this

[i-Ram]

I have just been on the HMRC Forum, and all they are taking about is what formation Wayne Rooney’s Derby County will play this year. A good number are going for 433 but personally I don’t think any of them have any idea whatsoever.

[TooFarInToTurnRed]

The “profit” on selling the ground was not £80m as you can only claim the amount above the value the asset is listed in the accounts. The profit for disposal of Tangible Assets listed in the accounts for 2018 was £39,940,387.

[Carnero]

Just now, TooFarInToTurnRed said:

The “profit” on selling the ground was not £80m as you can only claim the amount above the value the asset is listed in the accounts. The profit for disposal of Tangible Assets listed in the accounts for 2018 was £39,940,387.

Actually, the profit is the sale price less the original cost + any enhancement expenditure. Value in the accounts doesn't come into it.

[Tyler Durden]

I'm totally digusted and dismayed that on a football forum there appears to be an absolute lack of understanding of basic tax and accounting practices. 

Appalled from Thames Ditton.

[RoyMac5]

Just now, Tyler Durden said:

I'm totally digusted and dismayed that on a football forum there appears to be an absolute lack of understanding of basic tax and accounting practices. 

Appalled from Thames Ditton.

Been more impressed if you were from PwC!

[jono]

8 hours ago, Tyler Durden said:

Other posters have stated (in their opinion) that it's NOT anywhere near the £20 million that we owe HMRC as quoted in some news sources if that's helpful as again in their opinion HMRC would in no way allow that size of debt to accumulate without taking some decisive action before it got to that point.

They didn't however further (or more than likely not able to) quantify how much the monies owed ACTUALLY was to HMRC which seems to be the consistent piece of information which is lacking. 

I think the other poster was correct. They simply wouldn’t allow it to get that far given the size of the company, unless there was a complex back story along with negotiations. Much more likely is that whatever the figure, it was largely agreed prior to the event with the HMRC. I suspect there is a possibility that things were permissible at the start of COVID and possibly something didn’t happen when the takeover went wrong. And for the same reasons as the wages, Mel has been playing catch up to find liquidity funding. 

[Richard Dastard Lee]

As I remember it was the HMRC who was petitioning to wind up the club in 1984 when Stuart Webb pulled off the the 59th minute of the 11th hour rescue with the Robert Maxwell takeover.

I also remember him saying 'Derby County will never find itself in this position ever again'

Of all the current problems I think that owing the HMRC money again as in 1984 depresses me most

[Tamworthram]

48 minutes ago, Carnero said:

Actually, the profit is the sale price less the original cost + any enhancement expenditure. Value in the accounts doesn't come into it.

I’m not remotely qualified to answer my own question but can’t losses be carried forward (subject to certain restrictions) and offset against future profits? If this is correct, whilst we may have made a “profit” in the accounting period the stadium was sold, we could offset previous losses against this.

I’m sure I must have that wrong.

[RoyMac5]

8 minutes ago, Richard Dastard Lee said:

Of all the current problems I think that owing the HMRC money again as in 1984 depresses me most

But we've heard nothing from HMRC - so the position for the club isn't the same is my guess. If the fans/club hears from HMRC then is the time to worry.

[Carnero]

5 minutes ago, Tamworthram said:

I’m not remotely qualified to answer my own question but can’t losses be carried forward (subject to certain restrictions) and offset against future profits? If this is correct, whilst we may have made a “profit” in the accounting period the stadium was sold, we could offset previous losses against this.

I’m sure I must have that wrong.

Trading losses of the current accounting period can be offset against other gains of the same accounting period.

It's all moot anyway as I don't believe there is any corporation tax to pay when it is an intra-group transfer.

 

[Tamworthram]

29 minutes ago, Carnero said:

Trading losses of the current accounting period can be offset against other gains of the same accounting period.

It's all moot anyway as I don't believe there is any corporation tax to pay when it is an intra-group transfer.

 

Cheers. But, according to HMRC website, can't losses be carried forward to future accounting periods as well?

Here is an extract:

 

Carry forward a trading loss

Your company can carry trading losses forward to deduct from profits of future accounting periods as long as the trade continues.

 

[Carnero]

15 minutes ago, Tamworthram said:

Cheers. But, according to HMRC website, can't losses be carried forward to future accounting periods as well?

Here is an extract:

 

Carry forward a trading loss

Your company can carry trading losses forward to deduct from profits of future accounting periods as long as the trade continues.

 

Yes but i'm pretty sure that carried forward trading losses can only be set off against future trading profits (of the same trade).

[Woodley Ram]

3 hours ago, TheSlate said:

Yeah, agreed. I doubt it is anything like 4-5 million also, mainly because your CT is based on taxable profits for Corporation Tax include the money your company or association makes from:

doing business (‘trading profits’)

investments

selling assets for more than they cost (‘chargeable gains’)

If your company is based in the UK, it pays Corporation Tax on all its profits from the UK and abroad.

- What we don't know is how that 81m was layered on top of p and l. 

That's true, I based it on the max on turnover not net profit for CT, which as you indicated would be a lot less. I have heard people say that we will go into administration before the season starts. For me that unlikely to happen but we do need to get these sanctions off our backs and allow the press and other clubs to concentrate on other things rather than Derby County.  

[G STAR RAM]

1 hour ago, Carnero said:

Trading losses of the current accounting period can be offset against other gains of the same accounting period.

It's all moot anyway as I don't believe there is any corporation tax to pay when it is an intra-group transfer.

 

Or carried forward to be offset against future profits...

We know that the amount cannot relate to the sale of the ground anyway as it would have been shown in the 2018 accounts.

[i-Ram]

2 hours ago, Richard Dastard Lee said:

As I remember it was the HMRC who was petitioning to wind up the club in 1984 when Stuart Webb pulled off the the 59th minute of the 11th hour rescue with the Robert Maxwell takeover.

I also remember him saying 'Derby County will never find itself in this position ever again'

Of all the current problems I think that owing the HMRC money again as in 1984 depresses me most

I almost agree. Not being able to pay up in respect of our transfer obligations is worse in my book.  I understand it is alleged that we are outstanding on fees due to Peterborough, and perhaps others.

[TheSlate]

Personally, I HATE HMRC.