Modric the latest Real star implicated in tax investigation
According to Football Leaks, in a story picked up by Spanish daily El Mundo, the midfielder allegedly diverted income to a company in Luxembourg.
Spanish daily El Mundo ran a story on Tuesday around the reports circulating in various European Media based on the Football Leaks investigation into alleged breaches of tax law in the football world, among which the name of Luka Modric has emerged.
According to El Mundo, The Real Madrid and Croatia star allegedly diverted income deriving from his image rights to a company registered in Luxembourg between 2012 and 2014.
Investment company in Luxembourg
The newspaper reported that Modric created a company named Ivano SARL in December 2012, four months after his arrival in the Spanish capital from Tottenham Hotspur. El Mundo’s story says that Modric is the only stakeholder in the firm, which is managed by his wife, Ivana, with an unnamed Belgian national figuring as administrator.
The company, which was set up with initial capital of 3.6 million euros but within two years had increased its asset base to six million euros, invested the money in various investment funds and SICAVS (Investment Company with variable capital).
Tax authorities opened an investigation in January
According to El Mundo’s report, the Spanish tax authorities opened an investigation into Modric’s financial affairs last January. The probe was launched on the suspicion that during the period 2012-14, Modric allegedly failed to declare income relating to marketing and publicity in his personal income tax statement, although the existence of Ivano SARL was declared on the statement relating to wealth and assets.
The El Mundo story states that having created the company in Luxembourg, Modric’s image rights income would have been taxed at 1%, while in Spain the rate of tax on such income stands at between 30% and 51%.
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