Scottish Premier League (SPL) football team Rangers is to be liquidated after HM Revenue & Customs (HMRC) refused the club's bid to enter company voluntary agreement (CVA).

The decision means that a new company will have to be formed to take over the assets of the club and it could mean that Rangers are kicked out of the SPL.

HMRC was unhappy with Rangers' proposals to pay less than 9 per cent of its debts. In a statement HMRC also said that preventing a CVA would also allow it to pursue - and potentially prosecute - the directors that 'had created the problems at Rangers'.

The HMRC statement reads: "A liquidation provides the best opportunity to protect taxpayers, by allowing the potential investigation and pursuit of possible claims against those responsible for the company's financial affairs in recent years.

"A CVA would restrict the scope of such action. Moreover the liquidation route does not prejudice the proposed sale of the club. This sale can take place either through a CVA or a liquidation.

"So the sale is not being undermined, it simply takes a different route. Liquidation will enable a sale of the football assets to be made to a new company, thereby ensuring that football will continue at Ibrox.

"It also means that the new company will be free from claims or litigation in a way which would not be achievable with a CVA. Rangers can make a fresh start."

A new company is expected to be formed and take over all assets of Rangers FC. It will have to secure a majority vote from other SPL clubs to allow it to continue playing in the SPL.