Southend United owed £2.5m, lost 10 points and faced winding-up over a £275k tax debt

On 3 October 2023 BBC News reported that Southend United had been told it could be wound up at the High Court the next day unless it paid HMRC. Courts had heard that the club's debts reached £2.5m, owed to HMRC, its energy provider and football creditors, with £275,000 owed to HMRC still outstanding. In August the National League had docked the club 10 points because of the debt, and it had dropped out of the professional leagues in 2021 for the first time in 101 years.

Owner Ron Martin, who bought the club for £4m nearly 25 years earlier, described the HMRC debt as legacy PAYE on player wages from the League One and League Two years. The BBC understood some staff went four months without pay, the chief executive apologised for late wages, St John Ambulance refused medical cover for a match in February over unpaid fees, and Martin was due in magistrates' court over unpaid energy bills. The club's last published accounts, for 2019, showed turnover of £7.4m, an operating loss of £2.36m and £6.2m of staff costs.

Martin had put the club up for sale in March. In July he said he would sell his 70.6% stake for £1 but wanted £4.5m for the Roots Hall ground, the price he paid for it. A bidder, Justin Rees, said two bids had been rejected and that administration was a realistic threat. The BBC noted that this was far from the club's first brush with the High Court, after winding-up petitions in 2000 and around 2010.

Debts of £2.5m, a 10-point league deduction and a winding-up petition for a £275,000 HMRC debt.

The club ran on a chronic funding gap that its chief executive put at about £2m a year.

PAYE tax on player wages from earlier league seasons was left unpaid and accumulated as legacy debt.

Its accounts were long overdue, and the figures it did publish showed operating losses.

The owner tied the club's future to a Roots Hall redevelopment and a move to Fossetts Farm that had not progressed, and sale talks stalled over price.

A club that survives for decades on late payments eventually runs out of goodwill: tax, staff and suppliers all stop waiting at once.

The BBC article, updated on 3 October 2023, was published the day before the hearing, so the outcome is not in the source. Supporters were divided between boycotts, marches and protests, and a working group had been set up to look at forming a phoenix club if Southend United were liquidated. Southend councillors voted in September to consider an investment fund to support the club.