However, City of London police and HMRC have refused to confirm reports that a man was arrested at his home on the morning of Thursday 25th March.
Other sources have confirmed the individual in question was spoken to although he was not charged.
A spokesman from the Premier League football club said:-
“We do not feel it appropriate to comment until the police investigation has been concluded.”
Kinsella Tax Investigations recommends that anyone who has approached by HMRC on suspicion of committing tax evasion should appoint a professional adviser at the earliest opportunity.
It is believed that this new allegation is related to a long-running investigation into the payments of £550,000 from Portsmouth into the Swiss bank account of a company registered in the British Virgin Islands.
A former employee of the club contacted police in 2008 claiming the money had been paid in a way in which to avoid tax being incurred on a severance payment to an overseas player who had left the club.
Portsmouth Football Club told The Mail on Sunday that the £550,000 was in relation to professional services, including scouting, to be provided by the player and so was therefore not subject to tax.
However, a former club director said, in an internal email, that he had been told to set up a company in the British Virgin Islands to receive ‘full and final settlement’ of the player’s contract after he and the club had decided to go their separate ways.
If the payment had been subject to tax then HMRC should have received more than £200,000.
Former Portsmouth manager Harry Redknapp, ex-chief executive Peter Storrie and former owner Milan Mandaric have each been charged with counts of tax evasion and are due to appear in court in April.
All three men have denied any wrongdoing.
Portsmouth previously claimed that any agreement with the overseas player involved in the latest enquiry had been approved by lawyers and they were confident that there were no tax issues.
The club has confirmed that a fee had been paid to a company called Medellin Enterprises Ltd ‘for the release of [the player’s] registration and for ongoing professional services’.
They have said the money was to meet the company’s professional fees, not only for negotiating the player’s release, but to include other services such as scouting and working with foreign coaches.
Accountant Keith Grisset, an adviser of the club and board member for two months in 2005, was asked by club officials for further explanation of the payment to Medellin.
In his reply Grisset wrote:-
“My instruction was to set up an offshore company for [the player], which would receive his settlement. If that could be effected (and it was), [the player] would accept a considerably lower settlement. The reduced settlement figure was for £550,000 sterling, payable in three instalments.”
It is believed that the player concerned was earning in the region of £15,000 – £20,000 per week and would have cost Portsmouth nearly £1.5million to pay off the remaining 18 months of his contract in full. Paying him just £550,000 shows a considerable saving.
If you are the subject of a tax investigation into alleged tax evasion then the first, and most important, step to take is to get professional advice.
Kinsella Tax Investigations are here 24 hours a day, 7 days a week and can deal with any type of HMRC tax investigation.
Call us now on 0800 471 4546 for expert tax investigation advice.