Alan Nixon Breaks Silence on American Billionaire Bid

[atherstoneram]

Just now, PistoldPete said:

If we are relegated to League 1 , (almost certain)  that will mean less revenue and less spending for the club. The big bonanza years for HMRc will be over, sure . Wages are capped at 60% of income.

But our income will be around £15 million, so that is still about £9m in wages. HMRC take about 50% of that so that's £4.5 million. Then there is VAT and other spending etc. Probably around £6 milion a year in revenue for HMRC even for Derby in league One.   Why is that an unattractive proposition for HMRC? They would be complete fools to kiss goodbye to that, leave alone whatever the best p in the £ offer they can get from new owners for the current debt. Of course that tax in perpetuity will be far, far more than the amount currently owed.
 

HMRC are only interested in what they are owed as at present not predicting what they might get over the next number of years,as you post £6M a year dropping to league 1 so that's 5 years just to recoup what they currently owed. Not an attractive proposition is it. What if there is another situation where grounds have to close.Other businesses have closed which have no doubt generated more than £6M in  taxes.Sorry Pete just because it's DCFC doesn't mean HMRC will look at us any differently.

[GenBr]

1 hour ago, PistoldPete said:

If we are relegated to League 1 , (almost certain)  that will mean less revenue and less spending for the club. The big bonanza years for HMRc will be over, sure . Wages are capped at 60% of income.

But our income will be around £15 million, so that is still about £9m in wages. HMRC take about 50% of that so that's £4.5 million. Then there is VAT and other spending etc. Probably around £6 milion a year in revenue for HMRC even for Derby in league One.   Why is that an unattractive proposition for HMRC? They would be complete fools to kiss goodbye to that, leave alone whatever the best p in the £ offer they can get from new owners for the current debt. Of course that tax in perpetuity will be far, far more than the amount currently owed.
 

That £6mill per year would still be a fraction of HMRCs tax haul. If they cut a deal with us they may see many other businesses and football clubs attempting the same thing to see if they can also cut their debts.

[PistoldPete]

21 minutes ago, atherstoneram said:

HMRC are only interested in what they are owed as at present not predicting what they might get over the next number of years,as you post £6M a year dropping to league 1 so that's 5 years just to recoup what they currently owed. Not an attractive proposition is it. What if there is another situation where grounds have to close.Other businesses have closed which have no doubt generated more than £6M in  taxes.Sorry Pete just because it's DCFC doesn't mean HMRC will look at us any differently.

Sorry Atherstone I don't understand your argument at all. 

The admin team are acting on behalf of the creditors. By far the biggest unsecured creditor are HMRC, so the admin team are trying to get the best deal for HMRC. The admin team are also in  advanced stages of a competitive bidding process so have secured the best offer they think they can for creditors from potential buyers. Why on Earth would HMRC think they can do better than that?

That offer may be less than a £1 for £1 debt that is currently owed to HMRC. But what does HMRC gain by rejecting the best offer that the admin team can obtain and sending the club into liquidation ? The offer will be at least 25 %, maybe more who knows. I think it unlikely it will be a full £1 for £1 owed to HMRC. But at the end of the process, it will probably be the best that the admin team can get, and the best deal that HMRC can get for the taxpayer.

The alternative is to forego a minimum of £7m up front and ongoing tax revenues of £6 million a year even in League One. If we get promoted to Championship a fair bit more.   Other businesses may have closed because they cannot cover their costs on an ongoing basis. Derby can, even in league One. 

 

[PistoldPete]

9 minutes ago, GenBr said:

That £6mill per year would still be a fraction of HMRCs tax haul. If they cut a deal with us they may see many other businesses and football clubs attempting the same thing to see if they can also cut their debts.

That argument has already been destroyed earlier in the thread. For a start, if you want a deterrent, to even have chance of working as a deterrent,  you have to apply the penalty to the person who takes the  action  you are trying to prevent ie the former owner , not the creditors and the fans.  

 

And actually its  silly argument anyway. To anyone deep in debt should HMRC really be saying we would rather than us accepting your offer to pay us what you can afford we would rather you went bust and you pay us nothing? 

Edited December 7, 2021 by PistoldPete

[SBW]

Pistold, I hope what you're saying is right, but as a person I consider myself a rational thinker and it reads like pure blind hope.

 

HMRC don't care about Derby, our fans, the clubs future or anything.  They care about monies owed.  That's what they fought hard to be a preferential creditor.  They're not going to give that up and accept pennies in the pound and make a rod for their own back by setting a precedent which goes against what they fought for, it makes zero sense.

 

If they were going to do a deal that was in anyway favourable to Derby, it would have already happened.

 

 

 

 

[PistoldPete]

3 minutes ago, SBW said:

Pistold, I hope what you're saying is right, but as a person I consider myself a rational thinker and it reads like pure blind hope.

 

HMRC don't care about Derby, our fans, the clubs future or anything.  They care about monies owed.  That's what they fought hard to be a preferential creditor.  They're not going to give that up and accept pennies in the pound and make a rod for their own back by setting a precedent which goes against what they fought for, it makes zero sense.

 

If they were going to do a deal that was in anyway favourable to Derby, it would have already happened.

 

 

 

 

Well I care about the monies owed too. So as a taxpayer I want at least some of it back, not end up with nothing. I dont think HMRC are quick to make a deal, they are not quick to do anything. Doesn't mean it can't or won't be done.  

[SBW]

1 minute ago, PistoldPete said:

Well I care about the monies owed too. So as a taxpayer I want at least some of it back, not end up with nothing. I dont think HMRC are quick to make a deal, they are not quick to do anything. Doesn't mean it can't or won't be done.  

I think we all want all owed taxes paid, we can agree on that.  

 

But the £27m itself is a drop in the ocean too HMRC.  If they accept say, half, £13.5m.  They then let every other football debtor that 50p in the £1 is okay.  Going forward the implications of that are gigantic, much more than the relevance of Derby County to them.  

 

Would you fight for power (in terms of being a preferential creditor in this sense) to then essentially just 'give' that right away?  Precedence in law is everything, sentences is court of made off the back of precedence, people being found guilty and not guilty of offences is done so on the back of precedence.  That's why is makes zero sense that HMRC are going to do anything to benefit DCFC.  They don't care about us.

[Hordh]

21 minutes ago, SBW said:

I think we all want all owed taxes paid, we can agree on that.  

 

But the £27m itself is a drop in the ocean too HMRC.  If they accept say, half, £13.5m.  They then let every other football debtor that 50p in the £1 is okay.  Going forward the implications of that are gigantic, much more than the relevance of Derby County to them.  

 

Would you fight for power (in terms of being a preferential creditor in this sense) to then essentially just 'give' that right away?  Precedence in law is everything, sentences is court of made off the back of precedence, people being found guilty and not guilty of offences is done so on the back of precedence.  That's why is makes zero sense that HMRC are going to do anything to benefit DCFC.  They don't care about us.

HMRC are likely to be a hard nut to crack and as I have said before, they are very likely to use Derby as a test case going forward. A shot across the bows of other clubs. 

[Ghost of Clough]

4 hours ago, atherstoneram said:

It is the here and now HMRC will be concerned with not future predictions.

So they don't care what other clubs might do if in administration in the future either.

Can't have it both ways

[I know nuffin]

Read somewhere the rules were changed in favour of the HMRC was because they were upset that football debts were paid in full and they had to take a much lower percentage. Doesn't help Derby but you can understand their point of view and why they will play hard to get by lowering the goal posts

[AGR]

11 hours ago, Sparkle said:

They are entitled to take legal action against us if they wish but it should definitely be shouted about and not hidden under a carpet so that every other club knows exactly what’s going on and maybe we should be definitely stating that we have a provable case against QPR and let other clubs have an opinion. If we still had an owner I believe things would be different.

personally I will be boycotting Middlesbrough away as I will not put any money towards Gibsons club ( I do not blame the actual supporters) 

But that’s the point. We haven’t got a prove-able case against QPR just like they haven’t got a prove-able case against us and they know that. The only reason they are getting a penny out of us is because they are stalling the takeover and putting us on the verge of liquidation. If we weren’t in admin we would fight it off easily 

[AGR]

The way I see things are that HMRC aren’t going to reduce the debt by a single penny whilst we have sellable assets at the club like Bird, Bielik, Sibley, Buchanan, Knight, Thompson, Lawrence etc. If these players are sold for say £10m and we put that towards the repayment they may do us a deal then. The worst is yet to come if we sell all those players we will be lucky to stay in league 1 next season 

[Crewton]

2 hours ago, SBW said:

Then why did they fight to be a preferential creditor, to then give it up? Precedent is key in law.  I'm not sure capital punishment and debt are quite one and the same. 

So they could rise above unsecured creditors in the pecking order. It doesn't automatically mean they're duty bound to demand 100% of what's due to them. They can now decide what's the best solution for the exchequer, balanced against all other factors. Going through struggling companies like a wrecking ball in the midst of a pandemic may not be the best look. 

[Crewton]

38 minutes ago, AGR said:

The way I see things are that HMRC aren’t going to reduce the debt by a single penny whilst we have sellable assets at the club like Bird, Bielik, Sibley, Buchanan, Knight, Thompson, Lawrence etc. If these players are sold for say £10m and we put that towards the repayment they may do us a deal then. The worst is yet to come if we sell all those players we will be lucky to stay in league 1 next season 

The Administrators can't pay HMRC ahead of MSD. 

[jono]

1 hour ago, SBW said:

I think we all want all owed taxes paid, we can agree on that.  

 

But the £27m itself is a drop in the ocean too HMRC.  If they accept say, half, £13.5m.  They then let every other football debtor that 50p in the £1 is okay.  Going forward the implications of that are gigantic, much more than the relevance of Derby County to them.  

 

Would you fight for power (in terms of being a preferential creditor in this sense) to then essentially just 'give' that right away?  Precedence in law is everything, sentences is court of made off the back of precedence, people being found guilty and not guilty of offences is done so on the back of precedence.  That's why is makes zero sense that HMRC are going to do anything to benefit DCFC.  They don't care about us.

I disagree with this “the HMRC won’t accept because it will set a precedent” .. There aren’t any “implications for anyone except us fans. Companies go bust owing HMRC money all the time. The HMRC get as much as they can. That will be either from liquidation .. or from a better offer from a buyer of a refinanced company. No they don’t care about us, or any failed / failing business. It’s just numbers and boxes to fill and tick. They don’t dislike us either. 
 

the admins are only ever going to say .. this is what we’ve got, is it a goer ? 

The HMRC may well then  say to the admins .. see if you can get a bit more from N E W owner,  but they know the score. 
Sooner or later bluffs get called or buyers walk away and they risk being left with much less than new owner was prepared to offer.

There’s no politics here for what is every day business for HMRC. 

[B4ev6is]

5 hours ago, Kathcairns said:

Why do Derby have to buy them.

Yes of cause they do

Not going to send them for Derby for free are they.

[Grumpy Git]

No matter what crap happens to DCFC in the near future, just be glad that there is currently a standard England performance in an away Ashes test series to keep us off the back pages. ??

[Asanovic70]

Not well-versed in finance, but Derby have been in financial problems before (we seem twinned, I am always losing money to bet365). Perhaps we need to make an agreement with the HMRC to pay the entire sum in full, but that half of it is received at once & the remainder is paid in instalments (staggered) over a set/agreed time period between both parties, as well as an agreement in principle that more will be paid in the event of a successful sale of a player for a good fee, a particularly good cup run (you never know/wishful thinking) - just like loans can be repaid early.

This might offer prospective purchasers a bit more wiggle room. It is still a lot of money to find during a season but @Ravabeerbelly's posts were interesting & chastening reading*, but if we/the administrators show that we are committed to paying the debt in full (painful as that is), then they may begin to show a bit more flexibility regarding scheduling of repayments over a period of say, 4 years (5 at most if possible) with the proviso that the club doesn't want such an albatross hanging around its neck indefinitely either. In the meantime, any new incoming owner might actually attract others to join him or invest, just like we had the LoG, or GSE attempted to attract investors. This investment could see money reassigned elsewhere to paying debts/the HMRC.

The HMRC may be playing hard-ball if we are appearing to ask for a reduction in what is a test case. In the end, none of us want Derby to get liquidated and in a worse case scenario, a re-founded club would emerge, but if we are seen to be accepting of the full amount owed and simply asking for a bit of common-sense in terms of how it is paid, then perhaps they may be more accommodating.

Much mockery of our 11pts was made, but half of our PL revenue was assigned to pay off the long-standing debt of £53m+ rather than on signings. It was probably the only plus of that dreadful season & a sensible, if pragmatic decision. Perhaps this could be used as evidence to show that the club has made good on pay outstanding debts when in a financial position to do so.

* He was basically telling the lay-person like myself, or consoling our bitter disappointment at seeing our best players picked off in a January fire-sale with the fact that it is the club which is the going concern, along & its fan-base

[atherstoneram]

7 hours ago, Ghost of Clough said:

So they don't care what other clubs might do if in administration in the future either.

Can't have it both ways

I am relating to us in the here and now,not what may happen to other clubs in the future,i have not said about having it both ways.

[atherstoneram]

6 hours ago, jono said:

I disagree with this “the HMRC won’t accept because it will set a precedent” .. There aren’t any “implications for anyone except us fans. Companies go bust owing HMRC money all the time. The HMRC get as much as they can. That will be either from liquidation .. or from a better offer from a buyer of a refinanced company. No they don’t care about us, or any failed / failing business. It’s just numbers and boxes to fill and tick. They don’t dislike us either. 
 

the admins are only ever going to say .. this is what we’ve got, is it a goer ? 

The HMRC may well then  say to the admins .. see if you can get a bit more from N E W owner,  but they know the score. 
Sooner or later bluffs get called or buyers walk away and they risk being left with much less than new owner was prepared to offer.

There’s no politics here for what is every day business for HMRC. 

Of course it will set a precedent, if HMRC accept 25p in the pound then the next club that goes into admin will turn round and say,we are only paying 25p in the pound as that's what you accepted from Derby.  So the fight for HMRC to become preferential creditors has been lost.