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Barca Pays Millions In 'Voluntary' Taxes, Denies Wrongdoing In Continuing Neymar Probe

Feb 25 2014, 3:44am CST | by

Sticking to the “we didn’t do anything wrong” script, FC Barcelona has announced that it has paid the sum of €13,550,830.56 ($18.6 million US) to Spanish tax authorities to resolve outstanding...

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29 weeks ago

Barca Pays Millions In 'Voluntary' Taxes, Denies Wrongdoing In Continuing Neymar Probe

Feb 25 2014, 3:44am CST | by

Sticking to the “we didn’t do anything wrong” script, FC Barcelona has announced that it has paid the sum of €13,550,830.56 ($18.6 million US) to Spanish tax authorities to resolve outstanding issues related to bringing Brazilian superstar Neymar da Silva Santos Júnior to the club.

The club made the payment, according to its website, in order “to cover any potential interpretation made concerning the contracts signed in the transfer process for Neymar, although we remain convinced that the original tax payment was in line with our fiscal obligations.”

The club continued to deny any wrong-doing but stressing that the payment was a “voluntary contribution” and that “FC Barcelona has no tax debts.”

It’s a pretty hefty payment for the club if, in fact, “FC Barcelona has always fulfilled its tax obligations.” But it’s also clear that the club is anxious for the matter to be resolved. And it’s also clear that the payment won’t put a financial drain on the team ranked #3 on Forbes’ Soccer Team Valuations List. The club was worth an estimated $2.6 billion US (€2.048 billion) in April 2013.

The team was indicted on tax fraud charges last week in connection with signing of Neymar in May 2013. The signing put Neymar on a dream team which included superstar Lionel Messi, who has also grappled with Spanish tax authorities in recent months. Whereas Messi’s tax issues focused on allegations that Messi and his father had engaged in a series of transactions meant to hide income, in Neymar’s case, prosecutors have accused the team of fraud, claiming that Barca engaged in a series of “financial engineering” in order to avoid reporting requirements and the payment of tax. Specifically, prosecutors allege that payments made to a Brazilian company controlled by Neymar’s father were taxable but disguised as other payments.

Barca has denied any impropriety, claiming that necessary details of the transaction were made available and that it “was at all times in line with the relevant legal legislation.” Nevertheless, the club’s former president, Sandro Rosell, resigned his position over the scandal. Spanish authorities are reportedly investigating whether Rosell committed any crimes in his efforts to bring Neymar over.

The investigation was triggered by a complaint by Jordi Cases. Cases, a season-ticket holder and shareholder of the club, had complained that the deal surrounding the efforts to bring Neymar over from his former club in Brazil, Santos, wasn’t reported cleanly. The numbers, he argued, were all over the map and he wanted to see the accounts of the transfer. The club eventually admitted that the number they paid for Neymar was higher than originally reported.

The changing storyline caught the attention not only of fans – but of the taxing authorities. After an initial investigation, Judge Pablo Ruz ordered Spanish taxing authorities to examine the club’s tax filings for 2011, 2012 and 2013. Contracts related to the Neymar transaction were allegedly signed in 2011 and confirmed in 2013.

Judge Ruz has also asked Fédération Internationale de Football Association (FIFA), the international body which governs soccer, for the documents relating to Neymar’s contract. FIFA won’t turn those over willingly, indicating that it would only do so after a formal request to Swiss authorities, as the FIFA headquarters are in Zurich.

Neymar has not been charged in the scandal. On the field, he had a great season, scoring seven goals and eight assists in 18 league appearances for Barcelona this season. Off the field, he’s doing pretty well, too: even before his move to Spain, he was ranked by Forbes at #8 of the world’s best-paid soccer players in 2013.

Want more taxgirl goodness? Pick your poison: receive posts by email, follow me on twitter (@taxgirl), hang out with me on Facebook or check out my YouTube channel. If you want to keep an eye on documents I’ve posted, check out my profile on Scribd. And finally, you can subscribe to my podcast on the site or via iTunes (it’s free).

Source: Forbes Business

 
Update
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3 weeks ago

Khazanah throws MAS RM6b lifeline

Aug 29 2014 5:01pm CDT | Source: Business Times Singapore

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Source: Business Times Singapore   Full article at: Business Times Singapore
 

 
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3 weeks ago

MAS posts loss of RM307m for Q2

Aug 28 2014 5:00pm CDT | Source: Business Times Singapore

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Source: Business Times Singapore   Full article at: Business Times Singapore
 

 

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