The upper-tier judge, Lord Doherty, rejected the appeal against a first-tier tax tribunal decision, despite several issues being referred back to the original panel.

HMRC had argued that payments made to players and other employees should incur tax but the Murray Group, which previously owned Rangers, stated that these were in-fact loans.

The first-tier tribunal (FTT) had ruled in favour of the Murray Group by a 2-1 majority verdict in November 2013, and order that HMRC’s sizeable demands of over £46 million be “reduced substantially”.

The upper-tier appeal has largely upheld that decision but ordered some payments to be re-examined by the previous tribunal, which includes termination payments and “guaranteed bonuses”.

Yet, the Murray Group secured an additional victory regarding payments made to several people including former chairman Sir David Murray, which they stated were not special cases.

The decision, which does not affect the current Rangers setup, reads: “The appeal is dismissed except in so far as it relates to the termination payments.

“I shall remit the case to the FTT (i) with a direction to allow the taxpayers’ appeals against the assessments relating to the payments to the sub-trusts of Sir David Murray, his sons, Mr McClelland and Mr MacMillan; (ii) to proceed as accords in relation to the termination payments, the payments in respect of guaranteed bonuses, and any related questions of grossing up.

“Standing my findings and my disposal, the remit should be to the FTT as originally constituted.”

This all started in 2000, when Rangers’ major shareholder Murray International Holdings (MIH) set up an Employee Benefit Trust (EBT).

In 2010 the Glasgow Football Club confirmed they were under investigation by HMRC over offshore payments to players and the case later contributed to Rangers entering administration in February 2012.

“Oldco” Rangers was liquidated in June of that year and Charles Green’s Sevco Scotland company controversially decided to re-launch the club as a completely new company.

Then in November 2013 “Oldco” won their first-tier tax tribunal appeal, in principle, against HMRC’s demands over the EBT payments.

It is still unknown how many termination payments were made but the first-tier tax tribunal’s ruling referred to five “guaranteed bonus” payments.

Although Murray was satisfied with the decision he believes there were no winners.

A spokesman for Murray International Holdings added: “We are satisfied that the UTT (upper tier tribunal) has now published its widely awaited decision and note the contents thereof.

“We are pleased with the judgement which again leaves negligible tax liability and overwhelmingly supports the views collectively and consistently held by our advisers, legal counsel and MIH itself.

“We will therefore review the detailed content of the decision with our legal counsel and advisers to ascertain what action, if any, is now required by MIH.

“The decision substantially reduces HMRC’s claim in the liquidation of the old Rangers Football Club.

“While we have been successful in both the FTT and UTT, there are, as we have stated previously, no victors.

“This has been an exceptionally long, difficult and expensive process involving not just the FTT and UTT but also several approaches to resolve the matter with senior HMRC officials on a commercially sensible basis for all parties which were rejected.

“MIH has, at all times, recognised that the tax tribunal proceedings stemmed from arrangements put in place during its ownership. They were introduced before legislative changes removed the tax efficiency of such arrangements from the end of 2010.

“However, it is obvious that the much publicised existence of these proceedings overshadowed Rangers Football Club for many years and tarnished the external perception of its value.

“There can be little doubt that despite favourable legal opinion, potential acquirers were therefore dissuaded from pursuing their interest during a period in which we were marketing the sale of MIH’s shareholding.

“The case has also stimulated extensive press and social media comment, discussion and speculation, a significant quantity of which has been ill informed.

“During proceedings, it would have been entirely inappropriate for us to highlight fundamental misunderstandings or contribute to this public debate.

“Notwithstanding all of this, it is abundantly clear that Rangers Football Club would not have gone into administration or liquidation had the purchaser fulfilled its contractual obligations and responsibilities.

“Similar to the resolution of the UTT appeal, we hope that the relevant authorities conclude their investigations and commence proceedings at the earliest opportunity.”

Are you considering appealing a decision from HMRC to the First Tier Tax Tribunal? KinsellaTax can help!

KinsellaTax’s team includes ex-Custom and Excise Officers and ex-HM Inspector of Taxes, who are vastly experienced in all types of HMRC investigations and appeals.

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