Aston Villa expected to settle £4m tax bill to allay short-term administration fears

Aston Villa will play in the Championship for a third successive season in 2018-19

Aston Villa are expected to settle their £4m tax bill to stave off any immediate fears of administration.

The Championship club have paid HM Revenue & Customs £500,000 and will pay a further £1.2m by the end of the week, according to the Press Association.

Villa, who missed a tax payment to HMRC on Friday, are looking at funding options for the longer term.

Owner Dr Tony Xia warned of "severe Financial Fair Play challenges" after Villa's play-off final loss to Fulham.

He is understood to have short-term cash flow problems because of strict rules about money leaving his native China.

• 'Villa have gone to the casino, they've rolled the dice and it hasn't worked'

On Tuesday Villa suspended chief executive Keith Wyness, who was appointed by Xia when he took over during the summer of 2016.

Wyness' suspension is in no way connected to the club's unpaid tax bill.

The prospect of a third successive season in the Championship is proving to be highly damaging to Villa, who have invested heavily in players over the past two years and will receive a reduced Premier League parachute payment of about £15m next term.

That is likely to result in large cost-cutting at Villa Park, meaning they may have to cash in on saleable assets such as midfielder Jack Grealish.

It has already been announced that ex-England captain John Terry will leave Villa at the end of his contract this summer.