Erm, yes there was. Hence the penalty.

To reiterate, these schemes were about saving players tax. They had no effect on the cap whatsoever and were included within it.

So there's nothing for the club's to worry about then G??

If these offshore payments were now treated as nett couldn't they be grossed up for salary cap calculations?

I've no idea how any of it works, just idly speculating.

There isn't nothing to worry about regarding punishment from the RFL, the RFL are working with teams to help them avoid punishment from H M Revenue & Customs (Not the none existant Inland Revenue as the Gaurdian put it) The punishment will be regarding the payments of PAYE & NIC (pay as you earn & national insurance contrbutions).

Are you just covering your a[irs[/ie here?

Sorry Gareth but you have missed the key point here.

If (and I stress if) clubs are found by HMRC to have made payments to players free of (or at reduced rates of) tax or NIC, and IF it is determined that tax and NIC has been underdeducted and paid as a result, THEN the clubs will be required to account for that tax - plus interest and penalties - to HMRC. Likely going back six years.

That's bad enough.

But the really interesting issue is the effect on compliance with the salary cap. Because its the grossed-up amounts that would rank under the cap, not the net amounts actually paid. Which for clubs involved could well mean an immediate and retrospective salary cap breach for anything up to six years.

Its all hypothetical at this stage, as no-one has yet admitted to having had to settle with HMRC over this issue, but it does seem to be widely understood that HMRC HAVE been investigating these practices and that such practices HAVE been taking place.

The response of the RFL regarding retrospective SC breaches should it transpire that clubs DO have to settle with HMRC will be...interesting.

aye, but the RFL are supporting the clubs on the matter so all [ushould[/u be well on that front.

I appreciate that, but it's my understanding that the clubs haven't done anything illegal so any retrospective payments that took them over the cap for a given year shouldn't cause any action to be taken. However, I'm more than happy for someone with more knowledge of accountancy / economics to put me straight.

I'd of thought the salary cap went on the net figure paid by the club to their players. As the players dont see the nic & paye. Also some players could fall into being higher rate tax payers and the clubs in question may have to raise their gross pay so it works out the same as other players' net pay.

Not relevant whether its illegal, just whether the amounts paid to.on behalf of players complied with the cap. If it transpires that club thought to be within the cap for a given year is now found to have exceeded it, the RFL will HAVE to treat that as a discovery of a breach and re-open the SC review for that year, surely?

Otherwise, clubs which complied with the cap - or were caught by other technical breaches and punished accordingly - will surely raise a challenge, and they and their fans will accuse the other club/s of cheating. Like you guys did to at least one other club in the past, in fact?

Wrong. Its the gross pay. Check it out in the detailed SC rules - link on the RFL site last time I looked, and I have a copy on my PC.

The Gross pay will be the same though surely as it was tax saving exercise for the players.