Portsmouth shocked at taxman demands

LONDON - Troubled Premier League club Portsmouth have been ordered by Britain's tax authorities to pay money owed to them or face a court case in the New Year.

However, Portsmouth said that contrary to media reports, they had not been served with a winding-up petition, adding that they were working with the authorities to pay off their debts.

"Portsmouth Football Club has not been formally served with a winding up petition and is shocked and surprised this action has been taken in respect of VAT (Value Added Tax), PAYE (Pay as you Earn) and National Insurance Contributions which either have been, or are about to be paid, or are disputed," the club said in a statement on their website.

"The club is disputing the VAT amount outstanding and has formally notified HMRC (Her Majesty's Revenue & Customs) of this. We expect HMRC to withdraw their demands forthwith." CLOSELY MONITORING

The Premier League said it was continuing to monitor the situation.

"We remain in frequent dialogue with the club," it said in a statement. "Clearly, we hope they settle any issues they have with the HMRC before the court hearing."

Portsmouth have endured a miserable season on and off the pitch and are bottom of the table having won only four of 19 league matches.

The Premier League has imposed a transfer embargo on them due to the financial problems while players and staff have twice had the payment of their salaries delayed.

The south-coast club failed to pay first-team players on time in September due to delays in refinancing by then owner Sulaiman al-Fahim.

Saudi businessman Ali al Faraj subsequently bought 90 percent of the club's shares from Fahim. EXTREME EFFORTS

Portsmouth sacked manager Paul Hart last month and replaced him with former Chelsea boss Avram Grant.

Portsmouth said that since the takeover by Al Faraj in October great efforts had been made to reach payment arrangements with HMRC to allow the owner time to deal with the inherited debts.

"To date the new owner has injected a total of 9.7 million pounds of new funds to HMRC - 5.7 million paid and security to the value of 4 million pounds," the club said.

"In such a tough economic environment the club finds it hard to understand this action by HMRC."