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Xavi wins time after the suspension of the 2.8 million fine in the Court

Date: July 13, 2024 Time: 18:57:36

Xavi Hernández buys time in the latest fight with the Tax Agency for image rights during his time as a FC Barcelona player. The Contentious Chamber of the National Court has agreed to provisionally suspend the payment of the 2.8 million euros of penalty imposed by the public body after an inspection by the Personal Income Tax (IRPF) of 2015, The year he left the Blaugrana club. It must be taken into account that he has already achieved a first victory in the Economic-Administrative Court over some of the settlements issued by the AEAT in the same procedure.

The case begins with the inspection of the years between 2009 and 2015 regarding personal income tax. This entailed, as reflected in the Court order consulted by La Información, three regularizations: 4.1 million for the period between 2009 and 2012; 2.49 million for 2013-2014, and 915,000 euros for 2015. The former Barça player and now coach had presented accumulated economic-administrative claims. The Economic-Administrative Court, which turns out to be the previous step before the appeal before the National Court, fully upheld the player’s request regarding the provisional settlement agreement and partially the claim for the final settlement of 2015, although it did not agree with him regarding to the sanction.

This sanction involved the payment of 2.8 million euros. And it is this that is now provisionally suspended until the appeal is resolved. The rest of the personal income tax settlements are being appealed in the Court, while the one of 900,000 euros from 2015 was annulled by the TEAC but has not yet been formally executed. Hernández alleges that the immediate payment of the disputed debt “would cause him damages that were impossible to repair”, considering his current financial situation and solvency, the “high importance” of the recurring sanction and, above all, the fact of having had to disburse in the passed “very high debts” to the administration as a consequence of the various recurring regularizations.

According to the order, the player defends that it is impossible for him to face the immediate payment of this fine. “He will be in perfect readiness to do so when the procedural milestones on which the tax administration itself currently depends on reimbursement of the income unduly made by personal income tax from 2009 to 2015 occur,” he points out.

Xavi obtained several victories, although partial, in the different appeals filed before the Court. In March 2022, the National Court upheld the appeal regarding the Corporate Tax required of his company from the inspection of the years 2009 to 2012 due to the method chosen to value the transactions linked between it and the player. In April of that year, it obtained a similar result for the years 2013 and 2014. In these cases, these are relatively small amounts since the most relevant have to do with the regularizations approved by the Personal Income Tax.

The first case referred to personal income tax was substantiated in a ruling in October 2023. It was the one referring to the period 2013-2014, which involved the former player’s disbursement of 2.49 million euros. The National Court partially agreed only with regard to regularization for related-party transactions, but confirmed the rest. This is now being analyzed in the Supreme Court after the corresponding appeal was filed. There would still be two more rulings regarding the other tax settlements.

In the sanction that is now provisionally suspended, the Barça coach’s legal team puts forward similar arguments with respect to the rest of the cases. He understands that there is an “incorrect classification” as work income of the payments made by the culé team to the Double Match entity -controlled by the former representative-, considering that the contract for the provision of services signed between both “was real” and Not simulated as the AEAT defends. Furthermore, it insists on the expiration of the right to initiate the appealed file, having exceeded the period of three months from the notification of the corresponding liquidation, and on the “insufficient motivation” of the guilt when understanding that there is a “reasonable interpretation” of the law.

The social structure

All these settlements and the lawsuits that have arisen from them have the same origin: the declaration of image rights for the period in which the former player was still active at FC Barcelona. He, like many other stars, chose to record this income through companies to try to reduce the tax bill. The usual thing is that these rights are transferred to society. Many other players are in legal battles with the AEAT over this issue.

His former teammate at FC Barcelona, ​​​​Andrés Iniesta, also won his fight with the Treasury. The National Court ruled in favor of the AEAT’s claims for personal income tax from 2010 to 2015, annulling the corresponding settlements and penalties that would exceed 4 million euros. Predictably, the ‘assault’ will remain in the Supreme Court, where a Treasury appeal has been studied since the beginning of last year that will lead it to rule on what the method should be to calculate the taxes to be paid based on related operations.

* This website provides news content gathered from various internet sources. It is crucial to understand that we are not responsible for the accuracy, completeness, or reliability of the information presented Read More

Puck Henry
Puck Henry
Puck Henry is an editor for ePrimefeed covering all types of news.

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