Salary paid to the football player's agents by the clubs should be imputed as salary to the footballers.

The Central Economic-Administrative Court considers that the remuneration of the football players´ agents paid by the clubs is made on behalf of the players and therefore must be attributable to them.


A resolution of the Central Economic-Administrative Court, ( hereinafter the TEAC ) argues that the football player's agents remuneration satisfied by the clubs, should be satisfied on behalf of the football players, since they are the ones who benefit directly from their representation, being the true beneficiaries of the services. Therefore, the TEAC states that the remuneration of agents by the club involves an avoidance to pay Personal Income Tax by the football players, since it means higher salary for them.

The claimant alleges that the agents are paid because they provide services to the club, acting as intermediaries in the transactions between the club and the players, in the negotiation of contracts, acquisition and transmission of federative rights.  The role of agents is to mediate between the club and players; therefore, it is not considered that the remuneration has to be satisfied on behalf of the players and it should not be understood as higher compensation.

Both the inspection and later the TEAC dismiss what the claimant alleges, to the extent that, from the documentation obtained, it is concluded that the agents that receive remuneration from the club act as agents of a specific player and their remuneration is independent of the Club's interests. They rely on numerous jurisprudence that defend that these payments made by the club to the agents are actually payments on behalf of the players. This means that the players are the ones who should declare the payments as employment income and pay taxes according in accordance.

The football clubs, instead of paying the signing commissions to the players, pay them to the agents on their behalf. The TEAC concludes that the football players benefit from this action of the clubs, since they have not had to pay their agents for the services provided, so they would have to support a VAT quota without being able to deduct it for being final consumers. In addition, if the club had included the commissions in their remuneration, they would have increased their remuneration and with it their tax base and they would have had to pay the commission for their representatives without the possibility of deducting it in the PIT (Personal Income Tax) by taxing for the employment income.

The TEAC concludes that an imputation of income must be made to the players for the payments to the agents made by the club. It is based on the fact that the aforementioned operative by the Club presents a clear benefit to the players, since this way they do not have to pay their agents for the services provided when they were the main beneficiaries, therefore it is a remuneration of the club to the football players.


 B Law & Tax
International Tax & Legal Advisors

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Tags: Personal income tax, soccer player agents, withholdings and payments on account