Just days after publicising their own share issue, news broke that Hearts have been hit with a demand for unpaid taxes in the region of £1.75 million.
Due to an on-going dispute between the Edinburgh side and HMRC over players loaned to Hearts by Lithuanian outfit FBK Kaunas – owned then by Vladimir Romanov – during a period of seven years.
Salaries of those players who were loaned to Hearts, were only part paid by the capital side, but according to HMRC, the tax on the players’ full salaries should have been paid in the UK and not in the Baltic country.
Its another blow to the Tynecastle side who saw the SPL impsoe a 60-day transfer embargo after they failed to pay players wages on time.
Hearts have stated that they intend to fight their corner, insisting that the situation with the loan players from Kaunas is no different to any loan player agreement when the majority of wages is met by the parent clubs.
Earlier this week, Hearts launched a share issue to raise around £1.79 million from the fans. The fans would then secure a ten percent stake in the club.
Hearts are claiming that the share issue is nothing more than coincidental, given the amount is very similar to the HMRC tax bill and the timing of said share issue and HMRC issue being made public.
A look at the share issue on the official Hearts site includes a reference to the tax case as a potential risk, with the club directors set to defend the claims made by HMRC, but that the ‘burden of proof is on the Company and the tax will be payable unless the Company is successful in challenging the claims’.
Shoudl the tax issue go against the Tynecastle club, the club statement says that such a scenario ‘coul have a dramatically negative effect on the Company’.
Romanov’s Ukio Bankas Investment Group no longer invest money into the club, as Romanov looks to cut costs, reduce the sizeable debt at the club and effectively sell the club as he isreportedly fed up with football.
It is reported that Ukio is unwilling to meet the shortfall in club finances, with the wage bill reportedly around £7-8 million per year, Hearts are looking to cut their wage bill by 50% and with a number of their top players earning the most wages at the club – Andy Driver, Andy Webster and Marius Zaliukas – out of contract at the end of this season Hearts fans could ultimately see their club further weakened as Romanov, once dubbed as the saviour of Tynecastle, turns his back on the club – in part due to his failure to see his bank make the move to Edinburgh and also in part due to his continued run-ins with the SFA, SPL and the media.
It was already tough times at Tynecastle, but this latest news adds further woes on an already weakening relationship.