Share Transfers Agreed/Cooling off period

[Sudds_1]

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Somewhere in this thread, I described the fan trait of indiscriminately and irrationally referring to Hibs in times of stress and discomfort as a sort of dummy tit or comfort blanket. It has even spread to the Jambo media. In this morning's Jamboman, in three seperate stories by three different journos, on one page, there is reference to " the Tynecastle side's 5-1 destruction of Edinburgh rivals....". ; " leading Hearts to Scottish Cup glory" and " Heart's 5-1 hammering of their bitter city rivals in May's one sided Scottish Cup Final ". No coincidence and unbelievably, not one of the articles was penned by Bathgate himself ...... yes there's Jambo strength in depth in the good old Scotsman. This infatuation with us is going to grow arms and legs in the next few months as they slip into the abyss. Cold and temporary comfort methinks.

Hell mend them. The purchase of their comfort blanket (in the form of a big win over us last year) effectively means nowt as they slip into the abyss. Their arrogance has probably cost them their club..................

so..........let them sneer all they want. They're headed only one way......and we're going the other way.

[Treadstone]

Tom English webchat on Hearts at midday if anyone is interested .

http://www.scotsman.com/scotland-on-sunday/webchats

[Off the bar]

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Avatar changed . Thats all .

love it!

[Seveno]

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The word "potentially" is a powerful one

I suppose that the plan (this week's one, anyway) is to raise the cash to pay HMRC in the short-term. When that particular storm is over, and the hordes see how successful that plan was, they will flock in their dozens to buy the rest of the shares off Vlad, UBIG and the others.

I don't think the money is to pay HMRC but as working capital to keep them going till something turns up.

By the time you add interest and penalties, HMRC will be after much more than £1.7m and it will likely take a few months for the Tribunal decision to be announced.

i can't wait till wages day this month to see what happens next.

[Hibs Class]

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As Caversham Green says however I suggest opening this link and reading page 18.

http://view.vcab.com/?vcabid=gheSelg...2%2015:19:02-6

Had a look at that doc - laughed where it says that the pulling power of the club was best demonstrated when Hearts entertained Barcelona at Murrayfield in 2007 in a crowd of 57k

[DarrenSQH]

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Had a look at that doc - laughed where it says that the pulling power of the club was best demonstrated when Hearts entertained Barcelona at Murrayfield in 2007 in a crowd of 57k

haha yeah no one was there to see messi, Xavi and Ineista.

Its a joke they use 1914 as a marketing tool in their packages of shares. The 1914 package costs £10,000. I doubt anyone will take them up.

Packages
Maroon package- £110
Tynecastle £ 275
1874 £550
Robbo £1100
Tommy Walker £2750
Terrible Trio £5500
1914- £11000
Heart of Midlothian- £25000

[Part/Time Supporter]

A bit more detail on the tax case (from the HMFC point of view)

http://www.scotsman.com/sport/footba...ania-1-2605333

Problem still remains of how they can justify that 50/50 split of wages being taxed in Lithuania and UK, when the two clubs have common ownership.

[DaveF]

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A bit more detail on the tax case (from the HMFC point of view)

http://www.scotsman.com/sport/footba...ania-1-2605333

Problem still remains of how they can justify that 50/50 split of wages being taxed in Lithuania and UK, when the two clubs have common ownership.

Does that dilute the HMRC case and strengthen the yams hand, in your opinion?

[poolman]

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A wee word of advice to everyone. Pay attention to what CG, CWG and PTS have to say on the subject

.Net resident financial whizzkids

This thread would not be the same without their knowledgable input

Same for the Huns thread as well of course

[Hibernia Na Eir]

The Revenue will have a watertight case. they usually always do. Hertz better be ready!

[CropleyWasGod]

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Does that dilute the HMRC case and strengthen the yams hand, in your opinion?

IMO, it adds nothing to anyone's case. The journalist is guessing at what the exact issue is. "an outstanding amount of £1.75m in unpaid tax, which may relate to other benefits given to any of the 19 players loaned from Kaunas ".... means nothing.

HMRC will not say what the issue is. HMFC will make (probably biased) statements as to what it is. The rest of us (myself included) will speculate on what it is.

What Mrowiec says (about who is responsible for the tax) is contrary to what Robertson said at the weekend. And both are reasonable stances to take. I'll therefore reserve judgement.... and continue to speculate

[CropleyWasGod]

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The Revenue will have a watertight case. they usually always do. Hertz better be ready!

I almost fell off my chair there.

Sorry, that's just not the case.

[DaveF]

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IMO, it adds nothing to anyone's case. The journalist is guessing at what the exact issue is. "an outstanding amount of £1.75m in unpaid tax, which may relate to other benefits given to any of the 19 players loaned from Kaunas ".... means nothing.

HMRC will not say what the issue is. HMFC will make (probably biased) statements as to what it is. The rest of us (myself included) will speculate on what it is.

What Mrowiec says (about who is responsible for the tax) is contrary to what Robertson said at the weekend. And both are reasonable stances to take. I'll therefore reserve judgement.... and continue to speculate

Cheers.

I forgot it was BAnderson who wrote that article so that eliminates any possible journalistic integrity attached to it.

I guess I'll sit back and watch what happens. Seems to be all anyone can do.

[Saorsa]

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Cheers.

I forgot it was BAnderson who wrote that article so that eliminates any possible journalistic integrity attached to it.

I guess I'll sit back and watch what happens. Seems to be all anyone can do.

you forgot laugh

[Hibee87]

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Does that dilute the HMRC case and strengthen the yams hand, in your opinion?

Im no expert at all in regards to this and all i am basining my post on is guessing what I think might have happened here.

Hearts pay half wages through hearts

Kaunas pay half wages through Kaunas


the case which im guesing hmrc are chasing is this bit - 'which may relate to other benefits given to any of the 19 players loaned from Kaunas'


I wonder if any bonuses, win bonus, goal bonuses, clean sheet bonuses etc have been paid into the kaunas side of things therefore avoiding the UK tax on such earnings. I do belive that alot of there players wages and the reason the wage bill was so high was due to bonuses so I guess my question to the experts (cav/cropley) on here is - If hearts players loaned from kaunas were paid any additonal income through there Lith banks is this illeagal and does it sound plausable as to what the bill is for?

[RyeSloan]

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IMO, it adds nothing to anyone's case. The journalist is guessing at what the exact issue is. "an outstanding amount of £1.75m in unpaid tax, which may relate to other benefits given to any of the 19 players loaned from Kaunas ".... means nothing.

HMRC will not say what the issue is. HMFC will make (probably biased) statements as to what it is. The rest of us (myself included) will speculate on what it is.

What Mrowiec says (about who is responsible for the tax) is contrary to what Robertson said at the weekend. And both are reasonable stances to take. I'll therefore reserve judgement.... and continue to speculate

What an cutting edge piece that was....dig up an ex loanee and take his word for it that tax was paid on his wages. I don't think it even addresses the point in that HMRC are saying UK tax is due on all wages not just the UK paid piece.

Vlad must be really really tempted just to pull the plug and bolt.....

[DaveF]

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you forgot laugh

I assumed all Hibbies were on automatic laugh

[Mikey]

If they get hit with the tax bill they should make Campbell Ogilvie pay it.

[CropleyWasGod]

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Im no expert at all in regards to this and all i am basining my post on is guessing what I think might have happened here.

Hearts pay half wages through hearts

Kaunas pay half wages through Kaunas


the case which im guesing hmrc are chasing is this bit - 'which may relate to other benefits given to any of the 19 players loaned from Kaunas'


I wonder if any bonuses, win bonus, goal bonuses, clean sheet bonuses etc have been paid into the kaunas side of things therefore avoiding the UK tax on such earnings. I do belive that alot of there players wages and the reason the wage bill was so high was due to bonuses so I guess my question to the experts (cav/cropley) on here is - If hearts players loaned from kaunas were paid any additonal income through there Lith banks is this illeagal and does it sound plausable as to what the bill is for?

It's not illegal. However, if these players were HMFC employees (and I am still not convinced that they were) then any bonuses etc would be subject to UK tax (however and wherever they were paid) and should be put through the PAYE system.

[Part/Time Supporter]

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Does that dilute the HMRC case and strengthen the yams hand, in your opinion?

It's not as blatant as I thought it might be, but it's the same problem. What rationale was there for having HMFC pay half the wages, rather than a lesser or greater share?

Hearts have to prove (IMO) that the deals with Kaunas were done at arm's length. That's going to be very difficult, particularly in the cases where Kaunas signed a player and then immediately "loaned" him to HMFC. Protesting that they have all this paperwork documenting how the payments were made isn't going to cut it.

[cocopops1875]

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.Net resident financial whizzkids

This thread would not be the same without their knowledgable input

Same for the Huns thread as well of course

I'm still hoping they don't bill us for the Huns thread

[Hibee87]

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It's not illegal. However, if these players were HMFC employees (and I am still not convinced that they were) then any bonuses etc would be subject to UK tax (however and wherever they were paid) and should be put through the PAYE system.

Ah right bang goes my theory, cheers.

So if a player is loaned to hearts via kaunas say roman bednar for example, I dont think he ever set foot in lithuania but was signed for then and immediatly loaned to hearts would hmrc have a case about his earnings being half paid in lithuania?

[greenginger]

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Im no expert at all in regards to this and all i am basining my post on is guessing what I think might have happened here.

Hearts pay half wages through hearts

Kaunas pay half wages through Kaunas


the case which im guesing hmrc are chasing is this bit - 'which may relate to other benefits given to any of the 19 players loaned from Kaunas'


I wonder if any bonuses, win bonus, goal bonuses, clean sheet bonuses etc have been paid into the kaunas side of things therefore avoiding the UK tax on such earnings. I do belive that alot of there players wages and the reason the wage bill was so high was due to bonuses so I guess my question to the experts (cav/cropley) on here is - If hearts players loaned from kaunas were paid any additonal income through there Lith banks is this illeagal and does it sound plausable as to what the bill is for?

HMRC have all the rules on their side. They wrote them after all.

This scheme that they dreamt up to register the players in Kaunus before being loaned to the Yams has to be shown to be for " commercial reasons " not just a tax saving device.

If it can't be shown there was sound commercial reasons for operating the scheme, the HMRC have the power to set aside the scheme and apply the tax rules as if the scheme never existed.
In other words tax, NI on the lot with interest and penalties as far back as 2006. There has been notes on the Yam accounts going back to 2008 about this investigation.

[CropleyWasGod]

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Ah right bang goes my theory, cheers.

So if a player is loaned to hearts via kaunas say roman bednar for example, I dont think he ever set foot in lithuania but was signed for then and immediatly loaned to hearts would hmrc have a case about his earnings being half paid in lithuania?

If he was loaned to Hearts, then he isn't their employee. They have no responsibility in PAYE terms; they would pay Kaunas a fee per month. Which is where my confusion arises.

However, HMRC may have concluded that he IS an employee. Such decisions aren't up to the employer or employee... they are often decided on the basis of a number of facts. If that is the case, then all of the loaned players would be subject to PAYE.

If that is HMRC's position, and it is supported by the FTT, that could have serious implications for all cross-border loans.

[Caversham Green]

I've been assuming the tax case was a twist on the transfer pricing operation - e.g. V owns company Y in Scotland and company K in Lithuania. Tax rates are lower in Lithuania so K sell goods to Y at inflated prices to reduce Y's profits and increase K's making V's overall tax bill lower than it should have been. The same principle can be applied to wages so that V pays less for employees working in Scotland by paying them through K rather than Y. Neither arrangement is legal and the onus is on the taxpayer rather than HMRC to prove that such an arrangement didn't exist.

[cocteautwin]

I don't log on often, normally lurching in the background as a guest, but these few days I feel the need to contribute to what I have no doubt will become the longest thread in hibs.net history over the coming months, dwarfing the already legendary Rangers thread.

This is history in the making for our city rivals. Unfortunately for them it's soon to be the end of their history.

It's going to be a long slow death over the next few months. I'm afraid (not!) that the cancer is terminal for Jambos.

I'm off to get a huge bag of pop corn and watch this unfold.

This is undoubtedly the start of the end. GIRUY!

[Sergio sledge]

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It's not as blatant as I thought it might be, but it's the same problem. What rationale was there for having HMFC pay half the wages, rather than a lesser or greater share?

Hearts have to prove (IMO) that the deals with Kaunas were done at arm's length. That's going to be very difficult, particularly in the cases where Kaunas signed a player and then immediately "loaned" him to HMFC. Protesting that they have all this paperwork documenting how the payments were made isn't going to cut it.

Especially considering some of these players never played or even trained with Kaunas for the duration of their contract. Loans are legitimate means of getting players off the wage bill, or giving players game time before they either return to the parent club or get sold on. Either way it is ultimately the parent club which has the benefit of reduced wage bill for a period, improved player returning to them or an improved transfer fee at the end. How did Kaunas benefit from any of this? Reduced wage bill - No, increased because of the new player they signed. Player returns better - No. Increased transfer fees at the end - Unclear where these went. They got player "registration fees," whatever they are, but I struggle to see how they made any money out of it. The question HMRC will be asking is "Why didn't hearts just pay the transfer fee and sign the players themselves and save going through a 3rd party?" If Kaunas benefited and Hearts benefited, then surely Hearts would have been better off just removing the 3rd party and buying the player themselves. Unless there was some sort of tax benefit to buying the players through the Lithuanian club and loaning them to Hearts.....

As an aside, did anyone notice this photo in the share brochure?

ref.jpg

Can anyone explain the reason behind putting this picture into the section for the terms and conditions? Other than the obvious "5-1" hand signal the ref is giving.....

[s.a.m]

My opinion is about as inexpert as it gets, but I'm assuming that HMRC have taken the view that Hearts are at it, in claiming that some of their players are employed by Kaunas. Some of them are quite clearly Hearts' players alone, and have no involvement (other than their wages) with Kaunas. If you add to their obvious non-employment at Kaunas the advantage that is gained by the owner of both clubs, there is surely at least room for suspicion that they are avoiding paying UK taxes by employing people through kid-on loans.

Claros, and the many other foreign loanees plying their trade here, look like genuine loans because they have an employment history at the club that claims to employ them, and they generally go back there.

No?


[Edit: and Sergio Sledge has beaten me to it....]

[HIBERNIAN-0762]

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As an aside, did anyone notice this photo in the share brochure?

ref.jpg

Can anyone explain the reason behind putting this picture into the section for the terms and conditions? Other than the obvious "5-1" hand signal the ref is giving.....

I can.

They are 110% obsessed with us. Nothing matters during the season as long as they beat us. Small minds have small pleasures. They are far too busy with pictures of various coppers, refs and former players doing the 5-1 thing to notice that are on the way out of the SPL very soon.

I truly hope the taxman and the SPL bosses absolutely bury this club, the 3rd division isn't just punishment for them, they need a Gretna type expulsion.

[Part/Time Supporter]

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My opinion is about as inexpert as it gets, but I'm assuming that HMRC have taken the view that Hearts are at it, in claiming that some of their players are employed by Kaunas. Some of them are quite clearly Hearts' players alone, and have no involvement (other than their wages) with Kaunas. If you add to their obvious non-employment at Kaunas the advantage that is gained by the owner of both clubs, there is surely at least room for suspicion that they are avoiding paying UK taxes by employing people through kid-on loans.

Claros, and the many other foreign loanees plying their trade here, look like genuine loans because they have an employment history at the club that claims to employ them, and they generally go back there.

No?


[Edit: and Sergio Sledge has beaten me to it....]

That is correct. The share offer brochure specifically states the tax dispute is to do with players "loaned" from Kaunas to Hearts. They have signed several players on loan from other foreign clubs since Romanov took over (eg1 Skacel in his first spell there, eg2 Pinilla) and they aren't subject to this action.