UK Parliament demands HMRC answers over Manchester City's £830m financial breaches verdict

The House of Commons Treasury Committee has written to HMRC demanding answers over the tax implications of Manchester City’s Premier League guilty verdict, after an independent commission found the club arranged sham contracts to conceal more than £830m in secret funding across nine seasons.

The Premier League confirmed this week that City were found guilty of all charges relating to breaches of its financial rules between the 2009-10 and 2017-18 seasons. The independent commission determined that the club used fictitious commercial agreements to artificially inflate revenues and reduce costs. City continue to deny any wrongdoing and have until 2 October to lodge an appeal.

Treasury Committee chair Dame Meg Hillier MP has written to HMRC Permanent Secretary John-Paul Marks asking whether the department is aware of the commission’s findings, whether it has requested an unredacted copy of the report, and for an overview of HMRC’s work on the taxation of player and staff remuneration across football clubs. Her letter states: “While I acknowledge that taxpayer confidentiality may inhibit what you can disclose, I would welcome reassurance from HMRC that you are seized of the importance of these issues and the public interest in the case.”

The scrutiny extends beyond Parliament. Tax expert Dan Needle, writing on the Tax Policy Associates website, has raised the question of whether Manchester City may have underpaid HMRC by as much as £12m. Needle’s analysis centres on payments made to former City manager Roberto Mancini, which leaked documents suggest were routed through a consultancy arrangement with Al Jazira Sports and Cultural Club via a company called Sparkleglow Holdings Ltd.

Needle wrote: “Manchester City’s rule-breaking may go beyond football. The independent commission found that the club inflated its income, concealed expenses and paid a key individual through a sham consultancy. We believe the evidence points to £12m in unpaid UK tax. The consequences could include a much larger tax bill and a criminal investigation.”

His report is described as a preliminary assessment based on currently available evidence, and he acknowledges that City maintain their innocence. His conclusion is that, if the consultancy contract was indeed a sham as the commission found, the payments to Mancini should have been treated as employment income subject to UK PAYE income tax and National Insurance contributions in the usual way.

The findings place Manchester City at the centre of one of English football’s most significant legal and regulatory episodes, with the possibility of further proceedings — both sporting and potentially criminal — still unresolved.