NafisaLeicester City may be hit with a minimum 12-point deduction when they begin next season back in the Championship, according to reports.
The Foxes have reportedly violated financial regulations after scrambling to maintain a place among the Premier League’s top eight. Their unexpected relegation in 2023 dealt a massive blow to their revenue – and significantly lowered the maximum losses permitted across a three-year rolling period.
Although they earned promotion in 2023/24, they are heading straight back down – and have now been referred by the Premier League to an independent panel over an alleged breach of profit and sustainability regulations covering the period up to and including the 2023/24 season.
Leicester had already been referred to the panel for the three-year stretch ending in 2023 – when they reportedly exceeded PSR limits by £19.5 million – but avoided sanctions due to a technicality, successfully claiming they were neither a Premier League nor a Championship club at the time they submitted their 2022/23 financial statements. That loophole has since been closed by both the Premier League and EFL.
The club has posted total losses of £201.6m during the most recent three-year window – although some expenses, such as academy and infrastructure investments, don’t count toward P&S assessments – but are only permitted to lose up to £84.5m due to spending one of those years in the Championship. Premier League clubs can lose up to £35m per season, while Championship sides are capped at £13m, plus an additional £1.5m for the 2023/24 campaign due to inflationary pressures.
Regulators may come down hard on the club.
The Athletic report: “Because both the EFL and Premier League have prosecuted numerous PSR cases now, we also have a good sense of how many points a tribunal is likely to deduct for a significant breach, particularly if it is considered to be ‘aggravated’ as opposed to ‘mitigated’.
“Given Leicester’s long fight to avoid being sanctioned by either body and their most recent failure to submit accounts to the Premier League, they are almost certainly going to be charged with an aggravated breach. This would suggest a starting position of them getting docked 12 points, though with a good chance that the Premier League will ask for even more.”
There has been talk that Leicester might also face a transfer ban, although LeicestershireLive states “there are no indications yet that one would be applied”.
However, there is annoyance that any sanction will come next season, when they are expected to contend for promotion, rather than this one, when relegation already seemed inevitable.
LeicestershireLive report: “Had Leicester been charged with a breach of their 23-24 finances in January, when the assessments for the other clubs took place, the matter would likely be over now, and any points deduction would have been applied to this season, where it ultimately wouldn’t matter as they’ve been relegated anyway.
“It could be argued that Leicester dragged the situation out, but it was more the Premier League who have done so. Had the club not appealed the 22/23 ruling last summer, they would have started the season with a points deduction, harming their chances of survival. It was the Premier League that challenged the appeal board’s decision and took the matter to a tribunal, dragging out the case.
“In hindsight, yes, Leicester would have been better off not appealing in the first place, and accepting a points deduction at the start of this campaign, allowing them to start afresh next term.”
All this unfolds in a season when the Championship could feature as few as three clubs receiving parachute payments next season – the lowest total since the current format was introduced a decade ago. There were six such clubs in 2024/25.
Fourteen of the 20 clubs promoted from this division since Stoke City went down in 2018 have received parachute support, but Leicester’s £50m financial edge could be wiped out depending on the outcome of the PSR proceedings.
Sheffield United began this season with a two-point deduction due to missed payments to other clubs in 2022/23 and 2023/24 but still managed to finish third and secure a place in the play-off final.
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