Both son and father, Jorge, were sentenced to 21 months in prison for defrauding £3.59m euros from 2007 to 2009. Using companies in Belize and Uruguay to avoid paying image rights income in Spain.When Ronaldo signs an image rights deal with a company based in the US should he declare any of the income from it in Spain?
There is also disparity between what proportion of income one country allows a player to declare as image rights and what another one allows.
Here are all the players whose tax affairs have been brought to court in Spain. Because Ronaldo signed when the so-called Beckham Law was still in place he was entitled to declare only image rights income earned in Spain.
That leaves a lot open to interpretation. When Ronaldo signs an image rights deal with a company based in the US should he declare any of the income from it in Spain. But Spain benefited from a blind eye being turned on them declaring part of their wages as image rights. Players could set up companies that would sell their image rights to the club they were playing for and to the big brands.
The advantage was that those image rights companies would pay company tax from upwards of 28 per cent, instead of income tax from upwards of 47 per cent. They would also incur expenses that could be written off against the tax. It made sense and it was not illegal.
For long a time the Spanish taxman did nothing more than monitor how much a player was transferring his image rights to a third-party company for.
If he was transferring his image rights for £88 but the company was then making £880,000 from the sale of those image rights things the taxman would seek to 'readjust' the situation.
But in the late 90s the Spanish taxman began moving the goalposts, telling players that no more than 15 per cent of their club salary could be declared as image rights. And in 2015 there was a further clampdown in Spain on even setting up a company to deal with a player's image rights.
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