HMRC Winding-Up Petition Against Halifax Panthers

The Halifax Panthers, a Championship rugby league club in Halifax, West Yorkshire, has faced significant financial challenges in the latter half of 2024. According to Companies Court records, the company, namely Halifax Rugby League Football Club Limited, currently faces two HMRC winding-up petitions, with the most recent (Petition No. CR–2024-006281) issued on 22 October 2024 and the previous issued on 29 July 2024 (Petition No. CR-2024-004490). The club’s financial stability remains a critical concern. In September 2024, the club provided a Statement of Financial Update, revealing debts of approximately £80,000 and projecting a need for an additional £120,000–£150,000 to ensure operational sustainability through 2025.

On 29th July 2024, HMRC issued the first winding-up petition against the Halifax Panthers through case number CR-2024-004490, citing unpaid tax obligations. Urgent fundraising efforts apparently allowed the club to settle this liability, but the petition has not yet been dismissed according to current court records. On 22nd October 2024, the second winding-up petition was filed with case number CR-2024-006281, despite the club’s assurances that outstanding HMRC debts had been cleared. Clearly further UK tax debts are being pursued by HMRC.

What is a HMRC Winding-Up Petition?

An HMRC  winding-up petition is a formal legal request made by HM Revenue & Customs (HMRC) to the High Court, seeking the liquidation of a company that is unable to settle its tax debts, which are unpaid taxes or other liabilities. If the petition is successful, the court issues a winding-up order, leading to the liquidation of the company’s assets to pay off its creditors. However, the court may dismiss the petition if it determines that the company is not insolvent or at risk of liquidation.

Our expert team of HMRC winding-up solicitors play a crucial role in managing these complex cases. We offer expert legal advice on how to handle creditor disputes, negotiate settlements with HMRC, and provide representation in court proceedings. We help businesses explore options for financial restructuring to avoid forced liquidation, protect the company’s future, and resolve tax disputes efficiently.

At LEXLAW, our team of expert solicitors, based in the legal heart of London’s historic Middle Temple Chambers, offers nationwide representation for HMRC winding-up petitions. We prepare strong grounds of opposition, witness statements, and provide tailored legal solutions to navigate the complexities of winding-up hearings. Whether it’s preparing for court or negotiating with HMRC, we ensure the best legal strategies to protect your business from liquidation.

When does HMRC file a Winding-up Petition?

HMRC can apply for compulsory liquidation of a company if more than £750 is owed. The Commissioners must also prove that the company does not have the funds to pay the tax debt.

The unpaid tax could be:

• VAT returns;
• Unpaid VAT assessments;
• PAYE payments;
• Employer’s National Insurance Contributions; or Corporation tax.

How can a company defend a HMRC winding-up petition?

To oppose a winding-up petition, a company must file an affidavit in court at least 7 days before the hearing. The affidavit should also be sent to the petitioning creditor (which could be HMRC). Directors can attend the hearing to oppose the petition and ought to engage specialist solicitors and counsel for representation.

• Pay the Debt in Full

Paying the debt in full may reduce the risk of the petition being advertised, though this is not guaranteed. Immediate legal advice is crucial to manage negotiations. You should immediately get urgent advice and appoint experienced winding-up solicitors to manage the negotiations.

• Dispute the Debt

If there’s a genuine dispute over the debt, such as the amount owed, the company can provide evidence to the court. Legal advice is essential to notify the petitioning creditor. Seeking legal advice and notifying the petitioning creditor of the dispute is crucial. 

• Agree to a Company Voluntary Arrangement (CVA)

A CVA allows for a repayment plan and can stop the petition. If appropriate, solicitors can refer the company to CVA providers. If we review your case in an initial advice conference, and it is appropriate, then we can refer you to a trustworthy leading provider of CVAs.

• Negotiate with Creditors

Negotiating with creditors may prevent the petition from proceeding. Offering repayment terms can lead to an agreement that avoids liquidation.

• Consider Administration or Voluntary Liquidation

If necessary, entering administration or voluntary liquidation can be a solution to manage financial difficulties and address the petition.

• Request an Adjournment

A company can request an adjournment to delay the hearing, providing time to find alternative solutions. Solicitors can assist in securing adjournments effectively. We are experts in obtaining adjournments and have several methods in order to secure adjournments.

The Importance of The Shay Stadium

The Shay Stadium is crucial to the Panthers’ identity and their ties to the local community. In May 2024, the club settled £50,000 in rent arrears with Calderdale Borough Council and is working on a consortium-led ownership plan to ensure the stadium’s long-term use. This initiative aims to transform the stadium into a “Community Stadium” that benefits both the club and the wider Calderdale area.

Despite financial challenges, CEO Damian Clayton has confirmed the club’s commitment to The Shay, emphasising its importance for the club’s future and community engagement.

Steps Taken by Halifax Panthers to Address Financial Challenges

Since September 2024, the Halifax Panthers have implemented several strategic initiatives to strengthen their financial position and secure long-term sustainability, as stated by Damian Clayton, CEO of Halifax Panthers Rugby League, in an interview with League Express. The efforts including:

• The club successfully secured a six-year partnership with a prominent commercial partner, alongside multiple three-year agreements, significantly boosting their sponsorship portfolio.
• The Panthers have focused on diversifying their income streams by improving matchday experiences, launching exclusive new merchandise, and enhancing membership offerings to attract a wider audience and increase engagement.
• Through their Business Club, the club has strengthened ties with local enterprises, creating mutually beneficial partnerships that support both the club and the broader Halifax community.

Legal Position and Board’s Statement

In a recent statement by the Board of Directors, concerns about the HMRC winding-up petition were addressed :

“All outstanding liabilities to HMRC have been settled, and our legal counsel assures us that the club is in a strong legal position. The High Court hearing represents an opportunity to formally clarify our position. We remain confident of a positive outcome and are fully prepared to protect the integrity of the club. The unwavering support of our fans, sponsors, and stakeholders has been a cornerstone of our resilience. Halifax Panthers has been a vital part of the rugby league landscape for over a century, and we are steadfast in our commitment to ensuring this continues.”

In a positive development, the High Court has adjourned the hearing in the ongoing HMRC case, with the next hearing scheduled for 29th January 2025. This adjournment reflects the merit of the club’s position, and the Board reassures supporters that the Panthers are actively managing the situation in close collaboration with legal advisors.

Expert London Winding up Petition Lawyers

At LEXLAW, we specialise in tax disputes, winding-up petitions, and civil litigation. If you or your business are facing issues similar to those encountered by the Bank of London—whether it’s dealing with HMRC petitions, tax litigation against HMRC, or negotiation on your behalf—our experienced team is here to guide you through the complexities. We offer tailored advice to help protect your business and ensure compliance with legal requirements.

Expert Legal Representation in HMRC Petition Defence

If your company is facing a winding-up petition or similar legal challenges, our experienced solicitor and barrister legal team is here to assist. We offer comprehensive services for both issuing and defending winding-up petitions, ensuring that your interests are protected throughout the legal process. Whether you’re dealing with tax disputes, financial difficulties, or other corporate challenges, our elite lawyers can strategically guide legal proceedings. We specialise in litigation, providing tailored solutions to meet client need.

We guide our clients through the minefield of complex winding-up rules and procedure and manage the entire process. We have years of experience in negotiating with HMRC petitions as well as creditor, shareholder or director petitioners. We regularly represent our client companies in the Companies Court and successfully obtain adjournments (i.e. to allow time to negotiate and settle or to defend a winding up petition) and injunctive relief even against HMRC. We can help companies avoid having bank accounts frozen by preventing advertisement of winding up petition notices or (if already advertised in the London Gazette) by obtaining a validation order from the Court to unfreeze the company’s bank accounts. We have a proven track record of fighting for our clients and we know exactly how to get the best results for your business.