How UEFA's fines will affect Newcastle United's summer spending - Report

Newcastle United learned their fate from UEFA on Tuesday after breaching financial rules.

Newcastle were found to be in breach of UEFA's Squad Cost rules and Football Earnings rules, and as such were slapped with a total of £5 million in fines, with a further £6 million suspended in case of further breaches.

The Magpies had been working with UEFA to agree a settlement and are thought to be pleased with the outcome. When compared to the whopping fines Aston Villa have been hit with, we can consider ourselves quite lucky.

Even though Newcastle will not be playing in Europe next season, they still need to remain compliant as the goal is certainly to get back into the UEFA Champions League, or at least one of the Europa competitions. Therefore, the club and UEFA have strict spending plans in place, which will affect how Newcastle does business this summer.

Newcastle breached two of UEFA's financial regulations

As explained by The Athletic, there are two rules Newcastle breached.

Squad Cost Ratio (SCR) is the same method which will be employed by the Premier League from this season. It allows a club to spend up to 85% of its footballing revenue on amortised wages and transfer fees. UEFA's SCR limit is 70%. Far more prohibitive than the Premier League's.

The other rule Newcastle breached is the Football Earnings Rules, which are essentially the same as the old PSR regulations that everybody hated. However, whereas the Premier League's PSR loss limit was £105 million over a three-year rolling period, UEFA's limit is just £60 million.

Sandro Tonali holds the key to Newcastle's summer

Anthony Gordon's sale to Barcelona saw Newcastle cut a good chunk out of their overspending, which is why the fines were much lower than those of some other clubs.

It's thought that the sale of Sandro Tonali will be used to fund the squad rebuild that has been talked about for months now. The Magpies are holding out for £100 million for the Italian, and that should give them a decent amount of headroom to add a few players, although we shouldn't expect any 'big' signings.

You've got to love how your reward for success is punishment. It takes money to build up a squad capable of competing in the Premier League, and if you manage to do that within its rules, you're almost certain to have breached UEFA's, so when you enter one of their competitions, you get hit with sanctions. What a fantastically sane system they've built here.