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Cristiano Ronaldo accused of using an Irish company to avoid Spanish tax

But a firm connected to the Real Madrid star claims it was the victim of a cyberattack.

Image: Paul White/AP Photo

REAL MADRID STAR Cristiano Ronaldo has been accused of using a Dublin-based company to minimise the taxes paid on money earned from his lucrative image rights.

The claims have led to renewed accusations that Ireland was promoting “tax dumping” and stripping other European countries of their rightful revenue.

Yesterday Spanish newspaper El Confidencial published a document that appeared to show a 2012 deal between Dublin company Multisports Image Management (MIM) and a Saudi mobile phone company, Mobily.

El Confidencial reported that MIM was used to conclude an arrangement that would see Ronaldo’s image in an advertising campaign. The documents published by the newspaper appear to show that Mobily paid MIM €1.1 million as part of the deal.

The arrangement would give Mobily access to Ronaldo’s image rights for an advertising campaign and some social media marketing.

EU nationals are allowed to own companies in other states. However, the report highlighted the “obvious” tax benefits for the Portuguese footballer siphoning income through Ireland, where companies benefit from a 12.5% corporate tax rate.

This is half of the 25% levy on profits in Spain, where Ronaldo is currently residing.

The paper said that it worked with Football Leaks on the report. Football Leaks is a website which reveals footballers’ contract details and transfer fees as well as other information.

However, a separate Irish company connected to the Portugese soccer player has hit back at the report.

Spain Soccer La Liga Cristiano Ronaldo Source: AP/Press Association Images

Irish-based GestiFute International is one of a series of Irish-based special purpose firms established by soccer super agent Jorge Mendes, who represents Ronaldo and former Chelsea manager Jose Mourinho, among others.

Cyberattack

In a statement, the company said that “a number of different companies connected to the world of sports were victims of a cyberattack in several European countries, including Spain”.

“After more than eight months since the attack, in the past weeks Gestifute, its clients, advisors and other entities related to Gestifute have received detailed enquiries from various media organizations which are all members of a pan-European consortium.

“The most serious and malicious allegations in the enquiries relate to José Mourinho and Cristiano Ronaldo.”

It added: “Both Cristiano Ronaldo and José Mourinho are fully compliant with their tax obligations with the Spanish and British tax authorities.

“Neither Cristiano Ronaldo nor José Mourinho have ever been involved in legal proceedings regarding the commission of a tax offense.”

Ronaldo World Premiere - London GestiFute is connected to Ronaldo's agent, Jorge Mendes Source: Doug Peters/EMPICS Entertainment

The statement also mentioned that European tax authorities have different “criteria in terms of image rights”. It said that “foreign clients are often affected by these differences, which they respect and abide by”.

“In any cases in which there have been disagreements with the respective authorities on the tax criteria to be applied, these have always been resolved by agreement with the authorities without legal proceedings ever being necessary,” it said.

Commenting on the allegations, German Green Party MEP Sven Giegold said that “not only on the playing field but also when it comes to paying taxes, fair play should be the rule of thumb”.

He said the report illustrated the need for a common minimum tax rates for companies in Europe and added: “Once again it is Ireland that promotes tax dumping and takes away tax revenue from other EU countries.”

MIM and GestiFute

Ronaldo is not listed as a director or shareholder of MIM. It is likely that any deal involving the company would have been carried out by an agent working on his behalf.

The company had €4 million in cash as of the end of 2014, the latest year for which its accounts are currently available.

Dublin accountant Andy Quinn was the only director registered for MIM. He resigned from his position as a director at the company in August. Quinn is also listed as the director of several other companies, including GestiFute.

As previously reported by Fora, GestiFute paid out a whopping €6.5 million dividend in 2014.

Although it is not specified who the dividend is paid to, 95% of the shares of the Irish firm are held by a company called Start SGPS SA.

According to GestiFute’s website, Start SGPS SA is the holding company used by Mendes for all of his sports-related business dealings.

Written by Paul O’Donoghue and posted on Fora.ie

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