Promising halfback Arana Taumata's NRL career has been left in tatters with the Bulldogs tearing up his contract and Newcastle now set to withdraw their offer to sign him.

Taumata, 19, admitted to breaking the Bulldogs' code of conduct after he was involved in an off-field incident several weeks ago in which another man was left with a broken jaw.

While no police charges were laid, the Dogs held their own extensive investigation in recent weeks, including the use of a private investigator, before coming to the decision.

Taumata, who had already been sacked by Brisbane and the Sydney Roosters for off-field misbehaviour, was thrown a lifeline by the Bulldogs with a one-year contract that included a clause citing no second chances for misbehaviour.

But after his latest indiscretion Bulldogs chief executive Todd Greenberg said the club had no choice but to let him go.

"It's always a difficult decision, particularly when someone like Arana is playing some good football on the field," Greenberg said.

"But we gave him a one-year contract, his behaviour had to be exemplary, it hasn't been and we've terminated his contract.

In a further blow to Taumata, his sacking is also set to ruin a likely move to Newcastle next season, which had reached "advanced" stages in negotiations according to the club.

The Knights were reportedly keen to sign the youngster as a utility in the mould of Kurt Gidley.

Newcastle's board will vote on whether to withdraw their offer for Taumata, but chief executive Steve Burraston admitted it would be difficult to give him another chance.

"We believe that everyone's entitled to a second chance, so it's not a strict policy that says if you had a misdemeanour previously we won't employ you," Burraston told AAP.

"But if you had more than the one, it makes it very difficult for us.

"We just recently in the last few weeks released a new club culture booklet which spoke about our values and ethics and if what I'm hearing (about Taumata) is right, it runs in the face of that so that's why I'm saying it would be difficult for us to proceed further.

"I don't want to pre-empt anything and will let the board decide but under those circumstances I think it would be very difficult for us to keep an offer on the table."

Taumata had looked impressive this season in his first four NRL matches.

He scored a try on debut against the Broncos and followed up with two strong performances before being dropped back to the under 20s after the Dogs' 30-0 loss to St George Illawarra on Monday.

Taumata's sacking adds further drama to the Bulldogs, who are still dealing with the aftershocks of Sonny Bill Williams' shock departure last Saturday to pursue a rugby union career in France.

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