Premier League Points Deduction Tracker: Leicester Escape, But Which Teams Remain Under Threat From PSR?

Leicester managed to circumvent what had previously looked to be an unavoidable Profit and Sustainability sanction, much to the disappointment of Premier League officials. See the latest updates from the rest of the division below with our Premier League points deduction tracker.

What is Premier League PSR and How Does it Work?

The Premier League is by far and away the wealthiest league in football, and as such spending must be controlled to level the playing field.

Its Profit and Sustainability Rules (PSR) were introduced to try and limit losses that top-flight teams can incur over a specific time period. The current guidelines state teams can only make a loss of up to £105million over a three-year accountancy period.

It is also worth noting the £35million-per-season allowance does not include spending on a swathe of exempt categories, including youth investment and infrastructure development.

The effects of these rulings were truly felt throughout the 2023/24 season, with Nottingham Forest and Everton both suffering the consequences of heavy-handed spending, receiving points deductions as a result.

Leicester PSR Case – How Did They Win Their Appeal?

Much to the disappointment of the Premier League itself, newly-promoted Leicester have managed to escape a slap on the wrist following their PSR hearing this week.

After lodging an appeal to have their case reviewed, the board found that Leicester’s accounting period ended on June 30, 2023 – a little over a month after they dropped down to the Championship.

In response to the appeal board, the Premier League expressed their dismay, saying that it “effectively means that, despite the club being a member of the Premier League from seasons 2019-20 to 2022-23, the league cannot take action against the club for exceeding the relevant PSR threshold in respect of the associated accounting periods”.

They continued by saying that the outcome “will have created a situation where any club exceeding the PSR threshold could avoid accountability in these specific circumstances”.

Even without the threat of a points deduction, the Foxes remain favourites on football betting sites for an immediate relegation.

The PSR rules “are, in relevant parts, far from well drafted” according to independent panel that allowed #LCFC appeal. Pretty damning that. Leicester off on a technicality. Clubs’ lawyers are going to be going through PSR looking for more loopholes.

— Henry Winter (@henrywinter) September 3, 2024

Premier League Points Deduction Tracker: Teams Under Threat From PSR

A flurry of transfers towards the end of June may have perked the interests of Premier League fans, who awoke to a deadline day-esque amount of activity.

Clubs across the division scrambled to complete deals before the 30th June accounting deadline, with those operating on the very edge of PSR boundaries appearing particular busy.

Questions were raised by experts and even rival clubs, with at least one side intending to lodge a complaint to the league over clubs attempting to bend the rules.

In particular, the use of young players in quick-fire deals was apparent – the likes of Tim Iroegbunam and Lewis Dobbin were essentially swapped between Everton and Aston Villa – both clubs who remain under threat of PSR sanctions –  for a reported £9m each.

Aston Villa

“We found ourselves in a situation where we had make an important profit to avoid being in breach with the PSR,” said Damian Vidagany, Villa’s director of football operations.

“Everybody was cheering and celebrating the Champions League, but Monchi and I were at the party thinking how we could avoid a points deduction that would have spoiled a wonderful season.”

It has since been revealed that Douglas Luiz’s £42m move to Juventus this summer ensured Aston Villa escaped what could have been up to 10 points in deductions. The deal also took far longer than expected to negotiate, with the club managing to offload the Brazilian with a matter of hours to spare before the deadline.

The sale of academy prospect Omari Kellyman to Chelsea for £19m was also an eye-catching deal that, for many, looked to be a PSR compliance ploy.

Nevertheless, Villa look to be comfortable enough for now after raising just under £140m in sales, compared with a total expenditure of £156m this summer.

Everton

The club worked hard to secure a string of sales before the June 30th deadline, including the departures of Ben Godfrey and Lewis Dobbin.

However, although their position appeared much stronger than last season’s double points deduction, their tussle with PSR and the Premier League looks set to continue.

When breaking down Everton’s PSR losses over the assessment period, the room for manoeuvring appears slim. Their losses in 2022 stood at just £3.9m but the accounts of that year will now be removed from the period assessment.

A year later, those losses grew to £62.7m, so they will have to tread with caution this year so as to avoid more sanctions.

The club will also have to contend with deferred payments to players such as Beto and Youssef Chermiti, with instalments still to be paid to Udinese and Sporting Lisbon respectively following their arrivals last summer.

Chelsea

You may be curious as to how Chelsea are able to comply with PSR given they have signed entire squads’ worth of players in recent windows.

It is worthwhile noting that the club are incredibly savvy when it comes to using every available loophole. What may appear om the surface to be a lot of money spent on transfers is actually amortised – or in simpler terms – the fee is spread across the length of a player’s contract.

For example, Pedro Neto arrived for £54m this summer on a seven-year contract, which will only appear as small chunks across each financial year.

The Blues also brokered important deals for Omari Hutchinson (£20m) and Ian Maatsen (£37.5m) in the final days before the aforementioned June 30th deadline, while Conor Gallagher’s departure as a homegrown player was pure profit in the eyes of PSR.

Although Chelsea have spent the most money in the Premier League over the last five years, they have also received the most from sales.

For now, they look comfortable enough to continue an exhausting regime of selling and buying players to offset their PSR losses.

Newcastle

Much like the teams already mentioned, Newcastle also scrambled to sell before the June 30th cutoff. With major concerns over compliance and the knowledge that a points deduction would likely occur, the Magpies recouped £68m from academy duo Elliot Anderson and Yankuba Minteh, who were shipped off to Forest and Brighton respectively.

Newcastle’s £73.4m loss in 2022-23 is also only a fraction higher than their £70m in 2021-22. This effectively means that the new accounting period represents zero benefits.

It is also worth noting that their figure for the 2023-24 season – given sizeable transfer expenditure – will likely represent an even greater loss.

The sales of Anderson and Minteh will certainly have helped their cause, but departures of two incredibly talented academy players came out of necessity to comply, rather than a desire to sell. This likely means they are treading a little too close for comfort.

Nottingham Forest

After being one of two teams to suffer a points deduction last season, Forest have sought to offload players this summer.

Moussa Niakhate, Odysseas Vlachodimos, Orel Mangala and Joe Worrall were all sold for a combined £75m. Indeed, they have continued to spend, but sales over the last three years have also been fairly consistent with academy player Brennan Johnson’s £55m fee lending a strong helping hand.

Forest fans can certainly feel aggrieved at Leicester’s escape from punishment. Their points deduction came as a result of an assessment period which involved two seasons outside the competition, with many questioning why the Foxes managed to escape on a jurisdiction technicality.

So Leicester were relegated a matter of WEEKS before they filed their accounts so can’t be penalised by the Premier League

BUT

Forest were penalised by the Premier League for TWO OF THE THREE YEARS when they were in the Championship

PSR = make it up as you go along 🤬 https://t.co/V9QoyyvylT

— Karen Bond 🌳🔴 (@bondkaren76) September 3, 2024

Of course, independent panels can draw separate conclusions, but it is interesting that concerns over a lack of consistency are now being pulled into conversation.