Everton have been deducted two points for a second breach of Premier League financial rules.

Profit and sustainability rules (PSR) permit clubs to lose £105m over three years and an independent commission found Everton breached that by £16.6m for the three-year period to 2022-23.

They drop one place to 16th and are now two points above the relegation zone.

The Toffees had a 10-point deduction reduced to six on appeal in February for the three-year period to 2021-22.

Everton say the club will appeal the decision.

In its written reasons, the independent commission said the Premier League had asked for a five-point deduction for the club.

The commission decided that any breach of PSR justifies a three-point deduction, with an additional two points because Everton's breach of £16.6m - 15.8% above the £105m threshold - is deemed significant.

However, the commission accepted Everton's arguments for mitigation in relation to the fact the club has:

• Already been deducted points this season
• Suffered a loss of revenue because of the suspension of a sponsorship deal with Russian company USM
• Made an early admission of guilt

The commission concluded that the fact that Everton have already been punished this season merits a two-point reduction in punishment, with a further point for the loss of sponsorship revenue and early admission of guilt.

An Everton statement read: "While the club's position has been that no further sanction was appropriate, the club is pleased to see that the commission has given credit to the majority of the issues raised by the club, including the concept of double punishment, the significant mitigating circumstances facing the club due to the war in Ukraine, and the high level of co-operation and early admission of the club's breach."

The Toffees added that the club is "extremely concerned" at the "inconsistency" of the punishments, with four different commissions issuing four different points deductions this season.

Nottingham Forest are the other Premier League club to have been charged with PSR breaches this season and were docked four points in March, although they have lodged an appeal.

Championship club Leicester have also been charged by the Premier League for allegedly breaking spending rules during their last three seasons in the top flight.

There is no guarantee that Everton's appeal will be heard before the final games of the Premier League season on 19 May when Everton travel to Arsenal.

The 2023-24 season technically remains 'live' until the annual general meeting in June when relegated clubs transfer their certificates and 24 May has been selected as a 'backstop date' for the appeals process to be concluded.

Everton in transition

This second deduction comes at a time of significant uncertainty at Everton.

The club released their accounts covering the 2022-23 season on 31 March, reporting financial losses of £89.1m.

In September, owner Farhad Moshiri agreed to sell his 94% stake in the club to American investment fund 777 Partners. The takeover is going through the regulatory processes and the club is still awaiting for that to be approved by the Premier League.

Everton are also in the process of building a new stadium on the banks of the River Mersey at Bramley-Moore Dock, which is due to open in late 2024.