HEARTS were last night granted a crucial stay of execution in their bid to stave off the threat of liquidation but now have just three weeks of breathing space to pay their overdue tax bill.
With some highly-paid first-team players agreeing to defer their November wages, due to be received on Friday, a deal was struck with Her Majesty’s Revenue and Customs to make staged payments of the £450,000 of unpaid PAYE, National Insurance and VAT.
Despite stark warnings made by director Sergejus Fedotovas last week following the launch of a shares issue and the subsequent emergence of the HMRC-induced winding-up order, the agreement means that Saturday’s home match against
St Mirren will not be the last in the club’s history.
The troubled Tynecastle side now have until 2 December – a day after their Scottish Cup tie with city rivals Hibs – to settle their bill of £449,692.04 and have been warned they must pay the tax due on November’s and December’s wages on time.
The move comes after loyal fans rallied round with a vast range of fund-raising efforts and Fedotovas last night praised supporters and the players for helping to convince HMRC to defer their previous deadline of tomorrow until next month.
He said: “We are pleased that we have been granted this extension as it acknowledges the strenuous efforts that are going on to ensure this club continues to contribute to employment, society, community and football in Scotland.
“I also want to acknowledge the support from political and supporter groups. Their action is helping the club through a very important period. Make no mistake, the fans and players have been instrumental in achieving this extension with HMRC. The supporters’ efforts have been quite phenomenal.”
Fedotovas last week detailed a £2 million funding gap that needs to be closed so that the Tynecastle side can see out the season.
Another £1.75m tax bill is also being fought which, if enforced, could put the club’s future in serious jeopardy. The recently-launched share issue is aimed at bringing in up to £1.79 million and Fedotovas insisted last night that, despite the agreement reached with HMRC, there remain serious difficulties ahead. He added: “It is essential that they continue all their work to assist us in meeting financial targets at the club. It is imperative that they continue with this level of backing in the weeks ahead until the share issue closes on 19 December. We have a lot of hard work ahead of us in order to fully rectify our financial position but with further backing and ongoing fundraising by supporters we know that we have a very positive opportunity to create a strong club for the future.”
It emerged yesterday that Hearts enlisted support from the unlikely name of Ian Murray in their successful bid to come to an agreement with HMRC.
However, the figure in question is that of the MP for Edinburgh South, the Labour Party’s Shadow Minister for Business, Innovation and Skills, and not the former Hibs player and Hearts fans’ figure of hate of the same name.
Murray held talks with David Gauke, the Exchequer Secretary to the Treasury, and senior officials at HMRC. And, last night, Murray welcomed the agreement reached.
Murray said: “The perception was that the club and HMRC had reached an impasse over the deadline for the tax to be paid and my role was simply to try to oil the wheels and get discussions moving. On Monday morning I tried to bang a few heads together and get it moving. This is the result I hoped my intervention would achieve.”