EFL clubs not paying tax will avoid transfer ban as clubs face mass deferral after request to government for a tax holiday
- The EFL has asked the government for a tax holiday for its clubs in the pandemic
- Now leaders will allow clubs to default on their tax arrangements in order to help
- The new support measure will apply to financial problems created by Covid-19
EFL clubs are preparing a mass deferral of tax payments worth tens of millions of pounds after the board ruled on Monday that non-payment of PAYE will not be punished with a transfer embargo until February at the earliest.
Sportsmail has learned the EFL board have told clubs about the introduction of a new ‘Covid PAYE liability rule’, which will enable them to default on their tax arrangements if they are unable to pay due to the impact of the virus or have agreed a new repayment schedule with HMRC.
The Government are yet to respond to an official request sent by the EFL last month for a tax holiday for their 72 clubs and by lifting the threat of a transfer ban the board have effectively given the green light for non-payment.
Many EFL clubs have been hard-hit by the coronavirus crisis and tax support could help them
The new rule will stay in place until at least the end of February, enabling clubs to save millions in the short term, which may be needed to keep many of them in business, as around 50 per cent of their salary bills are ordinarily paid to HMRC in tax contributions.
The EFL asked last month for all PAYE to be deferred until fans are allowed to attend matches again. While the Government are yet to agree, it is understood the majority of clubs have agreed repayment plans with HMRC, which will enable them to take advantage of the new EFL regulations.
The new directive does not relate to non-payment of PAYE or National Insurance that was due before March 1, or any default that isn’t Covid-related.
EFL clubs on a tax holiday will not be punished with a transfer embargo until February