FC Barcelona hit with €23 million fine

One of Spanish football’s most famous names has been ordered to pay €23 million by the National Court.

The National Court of Spain has recently upheld a hefty £23 million fine against FC Barcelona for tax evasion, involving payments to players’ agents from 2012 to 2015.

The fine, confirmed in 2020 by the Central Economic Administrative Court (TEAC), relates to the Personal Income Tax that the club failed to pay.

This decision was made following a detailed review by the National Court, which found the club guilty of ‘tax simulation’ to gain unfair tax advantages.

Tax evasion tactics exposed

The court revealed that FC Barcelona engaged in elaborate schemes to avoid taxes. They were found to be compensating agents for non-existent services, effectively diverting part of the payment to the players.

This allowed the club to benefit from a more favourable tax treatment than that which should have applied to the actual transactions. ‘That is, to enjoy tax advantages that do not correspond to the actual operation carried out,’ the ruling stated.

The financial breakdown of the fine

The penalty breakdown includes €8,764,118 from the tax settlement, alongside additional fines for each year from 2012 to 2015. These fines totalled over €14 million, reflecting the severity of the club’s tax evasion practices.

Misrepresented relationships

The investigation concluded that the payments made to agents were, in fact, for the benefit of the players, rather than for services to the club.

Despite FC Barcelona’s claims, the court found that the agents were acting in the interests of the players, not the club. ‘The Inspection reaches the conclusion that the relationship established between FC Barcelona and the agents only serves to cover the payments made by the club to the players,’ the ruling added.

The role of the agents

Further evidence from the Royal Spanish Football Federation (RFEF) confirmed that the agents were not representing the club.

In some instances, the players’ parents acted in this capacity. Contracts between players and their agents clearly stated the agents represented the players, highlighting the club’s payment arrangements were proportionate to the players’ salaries.

This ruling sends a clear message about the consequences of tax evasion in football, as FC Barcelona faces the financial and reputational fallout of their actions.