Portsmouth have been hit with a winding up order by British authorities over failure to pay a STG1.6 million ($A2.4 million) tax bill.
The Championship club, whose financial problems have left them teetering on the brink of extinction in recent years, now face a new fight for survival following the petition by HM Revenue and Customs.
“Ensuring tax is paid on time should be at the centre of a football club’s business strategy just like any other business,” said an HMRC spokesman.
“Anyone that regards paying tax as an optional extra, or that uses tax collected from employees or customers as working capital, is potentially heading for trouble.”
The order had been anticipated by Portsmouth’s owners, who last weekend warned the club was in an “extremely serious” position.
“The club effectively ran out of cash at the end of December. The situation is extremely serious, we’re under extreme pressure to find a buyer,” Andrew Andronikou, the administrator of the club’s parent company Convers Sports Initiatives (CSI) told The Observer.
“Time is against us. The issuing of the petition effectively means the club loses its ability to use its bank accounts.
“But we’ve made other provisions. We’re not fazed or worried by it. The club’s debts are not significant, we haven’t got millions and millions of liabilities.
“We pretty much have two months’ PAYE outstanding. We have about STG800,000 a month and we never paid December and the club certainly is not in a position to pay this month so it’s a total of STG1.6 million.”
Portsmouth are currently languishing in 17th place in the Championship.