Embargos, HMRC Payment defaults, non payment of wages, the usual under Dai Wrongge

[Mr Angry]

I haven't seen this posted elsewhere; namely an interesting detail in the Wycombe statement from earlier today where they say they have put their purchase of the training ground "on hold" due to the planning issue.

"A Wycombe statement said: "Many of the details were still to be worked out, including potential sharing with Reading and how to ensure a smooth transition.

"Importantly, it was agreed that while the details were being finalised and due diligence carried out, Feliciana [Wycombe's majority investors] would provide sufficient financing to Reading to allow it to pay its tax obligations and operating expenses, including payroll for the staff and players."

That seems to suggest to me that our potential financial issues at the end of March have been sorted out; unless I have mis-read the meaning of the statement??

Hang on, Wycombe's owners are funding a League competitor for the privilege of negotiating the purchase of something they may not even be able to buy and use?

Someone is being played for a fool here.

All I can think of is that the payment was part of the purchase of the facility and used to guage genuine interest or not, like putting down a non-returnable deposit when buying a luxury car.....otherwise it absolutely makes no sense.

[WestYorksRoyal]

If I was a Wycombe fan I'd be pleased with today's development. Forget our own situation, it didn't make sense from their perspective and just felt off.

[Snowball]

I haven't seen this posted elsewhere; namely an interesting detail in the Wycombe statement from earlier today where they say they have put their purchase of the training ground "on hold" due to the planning issue.

"A Wycombe statement said: "Many of the details were still to be worked out, including potential sharing with Reading and how to ensure a smooth transition.

"Importantly, it was agreed that while the details were being finalised and due diligence carried out, Feliciana [Wycombe's majority investors] would provide sufficient financing to Reading to allow it to pay its tax obligations and operating expenses, including payroll for the staff and players."

That seems to suggest to me that our potential financial issues at the end of March have been sorted out; unless I have mis-read the meaning of the statement??

Hi, Mr A,

MY reading of the whole statement is that Wycombe (Feliciana) WERE going
to provide funds for March-April but they have pulled that offer.

Their last two paras seem to suggest we are on our own

Wycombe Wanderers Football Club and Feliciana have to put on hold the discussions and ongoing due diligence due to seeming planning limitations allowing only Reading FC to use the training grounds.

Wycombe continues to wish its neighbours good luck in solving its issues. For its part, Wycombe will continue its search for a training ground that meets its ambitions for the Club.

[Mid Sussex Royal]

I think it's fair that Bearwood falling through has thrown off Pang's funding plans. Presumably the plan now is exclusivity this week and loans provided by the buyer. I believe HMRC is due this week, but that will be lower than the wage bill. Perhaps ticket sales and efforts from the commercial team will get us over that hurdle, with exclusivity and loans arriving in time for next week.

Or everything is just fcuked. Or a middle ground. I'd rather have Bearwood than 2 points.

Yep HMRC is due on Friday, wages assume next Thurs....I'd hope maybe the enhanced ticket sales and efforts may get us over the line with the tax and hopefully exclusivity in the next 10 days in time for the wage bill.

[windermereROYAL]

We`ll know one way or another this time next week, it`s going to be a long one.

[andrew1957]

Assuming we just get 2 more points deducted and no more before the season end, I would much rather lose 2 points and keep Bearwood as part of a future sale than Bearwood being sold just to avoid a deduction. The win against Cambridge gives us a bit of a buffer and we can hopefully beat Northampton too.

The failure to sell Bearwood should also focus Dai's mind on pushing through the sale of the whole lot as one entity as quickly as possible - although the recent chain of events have left him with a very weak negotiating hand.

[Horsham Royal]

... I believe HMRC is due this week, but that will be lower than the wage bill ...

Does RFC pay VAT quarterly or monthly?
If quarterly the HMRC bill this month could be substantially bigger than previous months.

[Franchise FC]

... I believe HMRC is due this week, but that will be lower than the wage bill ...

Does RFC pay VAT quarterly or monthly?
If quarterly the HMRC bill this month could be substantially bigger than previous months.

If the club are a large payer (by HMRC definition*) so would have to pay monthly on account.
Quarterly payers would generally have to prepare the return by the end of the month following the end of the quarter, (the end of the quarter likely to be 31st March, with the return due end of April) and the balance, net of monthly payments on account, payable by 7th of the month following (i.e. May).

* Large payer includes companies with over £2.3m VAT due in a year, so revenue over c£11m

I accept there’s a couple of assumptions in there, but the principles are correct.
Would suggest that VAT shouldn’t be the March issue

[Mr Angry]

I haven't seen this posted elsewhere; namely an interesting detail in the Wycombe statement from earlier today where they say they have put their purchase of the training ground "on hold" due to the planning issue.

"A Wycombe statement said: "Many of the details were still to be worked out, including potential sharing with Reading and how to ensure a smooth transition.

"Importantly, it was agreed that while the details were being finalised and due diligence carried out, Feliciana [Wycombe's majority investors] would provide sufficient financing to Reading to allow it to pay its tax obligations and operating expenses, including payroll for the staff and players."

That seems to suggest to me that our potential financial issues at the end of March have been sorted out; unless I have mis-read the meaning of the statement??

Hi, Mr A,

MY reading of the whole statement is that Wycombe (Feliciana) WERE going
to provide funds for March-April but they have pulled that offer.

Their last two paras seem to suggest we are on our own

Wycombe Wanderers Football Club and Feliciana have to put on hold the discussions and ongoing due diligence due to seeming planning limitations allowing only Reading FC to use the training grounds.

Wycombe continues to wish its neighbours good luck in solving its issues. For its part, Wycombe will continue its search for a training ground that meets its ambitions for the Club.

That makes sense. Oh well.

[Forbury Lion]

... I believe HMRC is due this week, but that will be lower than the wage bill ...

Does RFC pay VAT quarterly or monthly?
If quarterly the HMRC bill this month could be substantially bigger than previous months.

I imagine quaterly as there is no point in anyone paying their VAT monthly as it creates more work and you are better off keeping the cash in your own bank account for as long as possible.

Corporation Tax on profits is 25%, we sold some players earlier in the year which may have generated some taxable gains but we can legally choose not to pay that tax and keep it back to offset against re-investments in new players bought roughly between the period of 1 year before the sale and 3 years after the sale of the player, As we've been running at a loss for sometime those losses can be carried forward to an extent too and offset against future profits, although I imagine Dai will look to do that at holding company level so he pays no tax on whatever he receives for the sale of the club, training ground and stadium, should still leave some for the new owners to offset against future spend though.

I imagine the plan to sell the assets separately and then liquidate was to avoid paying tax.

[Lower West]

... I believe HMRC is due this week, but that will be lower than the wage bill ...

Does RFC pay VAT quarterly or monthly?
If quarterly the HMRC bill this month could be substantially bigger than previous months.

I imagine quaterly as there is no point in anyone paying their VAT monthly as it creates more work and you are better off keeping the cash in your own bank account for as long as possible.

Corporation Tax on profits is 25%, we sold some players earlier in the year which may have generated some taxable gains but we can legally choose not to pay that tax and keep it back to offset against re-investments in new players bought roughly between the period of 1 year before the sale and 3 years after the sale of the player, As we've been running at a loss for sometime those losses can be carried forward to an extent too and offset against future profits, although I imagine Dai will look to do that at holding company level so he pays no tax on whatever he receives for the sale of the club, training ground and stadium, should still leave some for the new owners to offset against future spend though.

I imagine the plan to sell the assets separately and then liquidate was to avoid paying tax.

The issue to any potential buyers is the cost of buying and maintaining Bearwood. There's potential for a world class academy but at the moment little more than an empty shell. The German has offered something over £28 million for the Club, the Stadium and Bearwood. Bearwood alone cost £42 million to build. The Wycombe guy offered £25m for Bearwood. Though no idea what the plans were. Perhaps keeping part and eventually selling the rest to the new Reading owners to create a new training facility. Vultures are playing hardball knowing Dai is backed into a corner.

[Greatwesternline]

... I believe HMRC is due this week, but that will be lower than the wage bill ...

Does RFC pay VAT quarterly or monthly?
If quarterly the HMRC bill this month could be substantially bigger than previous months.

I imagine quaterly as there is no point in anyone paying their VAT monthly as it creates more work and you are better off keeping the cash in your own bank account for as long as possible.

Corporation Tax on profits is 25%, we sold some players earlier in the year which may have generated some taxable gains but we can legally choose not to pay that tax and keep it back to offset against re-investments in new players bought roughly between the period of 1 year before the sale and 3 years after the sale of the player, As we've been running at a loss for sometime those losses can be carried forward to an extent too and offset against future profits, although I imagine Dai will look to do that at holding company level so he pays no tax on whatever he receives for the sale of the club, training ground and stadium, should still leave some for the new owners to offset against future spend though.

I imagine the plan to sell the assets separately and then liquidate was to avoid paying tax.

RFC has brought forward losses of £191m. safe to say no one is worried about corporation tax. Companies don't pay capital gains taxes. Some of what you are trying to describe is rollover relief. As companies don't pay CGT they have no use for rollover relief.

You don't get to choose VAT monthly or quarterly depending on how big your VAT liabilities are. Stay away from doing your own tax affairs would be my advise.

[MouldyRoyal]

Utilisation of brought forward losses is restricted to 50% of profits (although first £5m is exempt from this). Companies don't pay CGT but are subject to chargeable gains regime that works similarly and brings into the charge of CT gains on assets, but then trading losses can be offset against those gains. In any event I suspect player contracts are capitalised as intangible assets and therefore subject to the "new" intangible regime anyway.

[Forbury Lion]

You don't get to choose VAT monthly or quarterly depending on how big your VAT liabilities are. Stay away from doing your own tax affairs would be my advise.

VAT is quaterly, but you may be asked to make payments on account monthly towards your VAT bill. HMRC will tell you to make payments on account if you send VAT returns quarterly and you owe more than £2.3 million in any period of 12 months or less.

We'd have to be selling £11.2m (£13.8m inc VAT) in a 12 month period to be forced into making payments on account. That would also be Net of VAT claimed back on purchases including VAT.

I guess someone could workout how many shirts, tickets, invoices to sponsors etc we'd have to do in that period to hit £11.2m/£13.8m.

[Mid Sussex Royal]

The key immediate question is do we need exclusivity this week, so someone can provide funds this week to cover the tax due on Friday (otherwise we are -2) or do we have funds at least for the tax now as has been rumoured on Twitter? I'm not sure Dellor covered this earlier....

[WestYorksRoyal]

The key immediate question is do we need exclusivity this week, so someone can provide funds this week to cover the tax due on Friday (otherwise we are -2) or do we have funds at least for the tax now as has been rumoured on Twitter? I'm not sure Dellor covered this earlier....

I got the impression from Howe's interview that this is the case.

[Snowflake Royal]

No one can be sure, we'll find out by Monday.

[Lower West]

The key immediate question is do we need exclusivity this week, so someone can provide funds this week to cover the tax due on Friday (otherwise we are -2) or do we have funds at least for the tax now as has been rumoured on Twitter? I'm not sure Dellor covered this earlier....

Likewise the month end payroll. Same again then next month. Plus all the other ad-hoc bills for the organisation. Middle of May seems a long way to go as matters currently stand.

[PremAddict]

I know it's been said enough times, but the EFL had a part to play in our predicament. And I've never really understood the points deductions for off-the-field issues. Would love for some legal entity to start freezing assets of Dai instead. At this stage points deductions only hurt the fans and employees of the club, not the owner.

[East Grinstead Royal]

Each points deduction increases the possibility of relegation, which reduces the value of the club.