Never trust anyone who speaks with certainty about PSR, the Premier League and UEFA’s Profit and Sustainability Rules – and that includes Manchester United and Sir Jim Ratcliffe.
On paper, the Premier League’s rules are simple. Man United are allowed to lose no more than £105m over a rolling three-year period and those losses must be underwritten by Ineos and the Glazers.
But another layer of complexity is added when you consider that various expenses – such as infrastructure investment, depreciation, academy and women’s team spending – are exempt from the calculation.
Infographic explaining Profit and Sustainability Rules (PSR), the system which used to be called Financial Fair Play (FFP).
Profit and Sustainability Rules infographic Credit: Adam Williams / United in Focus / GRV Media
Then, there are intricacies around accounting year-ends, whether a profit or loss is in one year or the next, and jurisdiction between the Premier League, UEFA and the EFL with their distinct but interwoven systems.
After that, you have to consider financial reporting differences. United submit a different set of accounts to the Premier League than they do at Companies House or the New York Stock Exchange, for instance.
Next, mitigating factors. By way of example, United chalked up losses of £40m to the pandemic in the last three-year PSR assessment, while costs associated with Sir Jim Ratcliffe’s takeover were excluded too.
Basically, there are loopholes within loopholes within loopholes. No one, not least clubs and governing bodies themselves, can definitively say ahead of time whether or not the Red Devils will breach PSR.
Even in cases where a club looks to be in flagrant breach of the rules, accountants have a funny habit of playing Houdini, bending the finances and distorting reality to swerve points deductions and fines.
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Look at United, who have lost almost £300m in the last three completed financial years but, as the Premier League have confirmed, have managed to avoid a breach.
Chart showing Manchester United's pre-tax profit and loss account from 2013-14, superimposed over an image of Sir Jim Ratcliffe
Chart showing Man United’s profit-and-loss account CREDIT: Plumb Images/Leicester City FC/Getty Images
So when Sir Jim Ratcliffe commissioned a letter to United fans in January saying the club would fail PSR without a brutal programme of mass redundancies, he was talking out of his Stretford End.
See also: the hyperbole – if not outright fiction – about going bust by Christmas.
For a club like Manchester United, with their resources and influence, there is always a wildcard to play.
Photo by Ash Donelon/Manchester United via Getty Images
Photo by Ash Donelon/Manchester United via Getty Images
That doesn’t give the club carte blanche to hand Ruben Amorim whatever transfer budget they like this summer. Whichever way you cut it, the finances are in bad shape. A tectonic shift is long, long overdue.
However, PSR is not a monolith that dictates every element of United’s recruitment and retention strategy as well as how they conduct themselves as a business and community institution. It just isn’t.
To tell fans otherwise is disingenuous and asks them to ignore the evidence directly in front of them.
Chelsea, whose spending under Todd Boehly and Clearlake would make even Roman Abramovich blush, are case in point.
Manchester United could copy Chelsea’s PSR-busting asset sales
With over £1bn spent since the takeover in May 2022 and only a fraction of that recouped in player sales, Chelsea are the PSR equivalent of a medical miracle.
They have managed to duck and weave punches from the Premier League’s PSR enforcers through a combination of accountancy sleights of hands, contractual jiggery-pokery, and sheer luck.
Their latest accounts, released on Monday, show that the Blues recorded a pre-tax profit of £128.4m for the 2023-24 financial year.
Following losses of £121m and £90m in 2021-22 and 2022-23, that brings them within the PSR threshold.
How did they manage that in a season when they had one of the highest amortisation bills in the sport’s history, plus no Champions League money?
Their great escape this time around follows a similar logic to their 2022-23 accounts and illustrates why, for United, there will always be a get-out-of-jail-free card should they need it.
In the previous financial year, Chelsea slashed their losses by £76.5m and avoided a PSR breach by selling two hotels at Stamford Bridge to another club-owned company.
Effectively, they took money out of one pocket and put it into the other. This time around, they have done the same, selling the women’s team to themselves for just under £199m.
And what’s more, amid a spate of demanding legal cases at Premier League HQ, the league’s administrators have failed to close this loophole, though not for lack of trying.
Photo by Visionhaus
Photo by Visionhaus
That means intra-company tangible asset sales are, for the time being, still fair game. What does this mean for United?
Well, their accounts show £183m of fixed tangible assets – property, plant and equipment at the stadium, training ground and offices – which they could theoretically use to bypass PSR.
One thing to note is that UEFA, whose PSR system is based on spending as a percentage of revenue as opposed to profit-and-loss, have not cleared the asset sales.
As a result, Chelsea will almost certainly fail UEFA’s PSR assessment this time around, as might United if they chose to go down this route.
Chelsea managed to get around their 22/23 accounts by selling hotels to themselves.
They managed to get around their 23/24 accounts by selling their women's team.
I don't think this is what the Premier League had in mind when created PSR, to make football more sustainable.
— Dougie Critchley (@DougieCritchley) April 1, 2025
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However, UEFA’s regulation has proved to be something of a toothless tiger, with only token fines being handed down to clubs such as Barcelona who have been wildly over the allowed threshold.
Aston Villa too are set to breach UEFA PSR, but their owners have simply accepted that they will get a slap on the wrist and a modest fine.
That is an option for United, whose risk-benefit analysis would surely lead them down a similar path if they ever reached this inflection point.
Sir Jim Ratcliffe’s stance on PSR
When it comes to his words and his actions, there has been a gap as far as Sir Jim Ratcliffe’s attitude towards PSR is concerned.
One the one hand, he told Bloomberg last year in reference to PSR: “We’ve got more accountants than we’ve got sporting people at Manchester United
“If you’re not careful, the Premier League is going to finish up spending more time in court than it is thinking about what’s good for the league.”
“If you start interfering too much, bringing too much regulation in, then you finish up with the Manchester City issue, you finish up with the Everton issue, you finish up with the Nottingham Forest issue – on and on and on.
But on the other, notes in United’s accounts, which were signed off by Ratcliffe, express their support for PSR. UIF also understands that they voted to retain the system for at least one more season in 2025-26.
That is somewhat at odds with what many though they would do.
The alternative to the existing PSR system was a new mechanism which would limit spending on wages, transfers and agent fees to 85 per cent of turnover and profit on player sales.
Infographic showing Manchester United's annual debt since the Glazers bought the club via a leveraged buyout in 2005, superimposed over an image of Avram and Joel Glazer
Manchester United debt infographic prepared by United in Focus and GRV Media Photo credit: Michael Regan/Getty Images
Crucially – and unlike the existing system – that would mean that United’s annual interest payments, which could spiral as high as £50m in the next two years, would not have counted towards PSR.
His vote to retain the existing model may have been herding in the face of the inevitable (the vote was 19-1) but it does further illustrate the Ratcliffe PSR paradox.