How Cristiano Ronaldo has dodged tax on image rights through an Irish company
Reports in El Confidencial and Football Leaks claim the Madrid may have a tax problem...
Cristiano Ronaldo could become the Spanish tax authorities' next target. According El Confidencial on Thursday, the Real Madrid star has been invoicing for most of his advertising revenues through an Irish company (Multisports & Image Management (MIM) Limited), in which the name of the player does not even appear.
The company MIM Limited was incorporated in 2004, with no apparent relation with Cristiano Ronaldo, and with its fiscal base in Dublin. It turns out that Ireland is the European country with the lowest corporation tax, around 12.5 percent, so the Portuguese international would have saved a lot of money with this manoeuvre. In fact, Ireland is considered as practically as a tax haven by experts.
Spain's tax authorities do not take kindly to image rights going through a country other than the residence of said person, given they consider that all income must go through the IRPF. Therfore, taking into account that Cristiano resides in Madrid, he should have paid taxes of 43.5 percent of the advertising revenue generated.
Football Leaks originally revealed the advetising agreements that have gone through MIM and they include contracts with Nike, Unilever (Clear shampoo), Kentucky Fried Chicken, Konami (Pro Evolution Soccer), Toyota Thailand, Banco Espirito Santo, Jacob & Co. and Mobily.
This information is accompanied with all kinds of details and documentation, such as the founding act of the mercantile company, as well as some of the contracts signed with brands that sponsor the player, as the player himself has shown off on his social networks. One of the curiousities is that even though Cristiano's name does not appear in any of the company's records, Cristiano Ronaldo and Cristiano Ronaldo Legacy are registered trademarks owned by MIM.
If Spain's tax authorities investigate the case, Ronaldo could encounter another problem. If the player has declared in Spain his relationship with MIM, the subject could be closed by administrative routes and with an economic fine. If, on the other hand, he did not declare the relationship, the issue could go take the criminal route, implying a jail sentence in the case of being found guilty.
Little more than a year ago, Ronaldo was already accused of defrauding the Portuguese tax authorities.
It's not the first time image rights have propelled a player into the spotlight. Lionel Messi and Javier Mascherano have both paid for erros, while other players, such as Adriano Correia and Samuel Eto'o, are currently involved in similar cases.
Topics with the letter
