The Internal Revenue Service (AT) is demanding that Fernando Santos, the national football coach, pay more than 4.5 million euros to the IRS. The news published by Expresso explains that contracts between the coach and the Portuguese Football Federation (FPF) are at stake, namely the exercises of 2016 and 2017, when the coach received almost 10 million euros from the Federation, having declared and paid the IRS. for an annual salary of 70 thousand euros.
According to the tax authorities, the way in which the coach received and declared his income through a sole proprietorship was artificial and was mainly aimed at reducing taxes.
A few months before Fernando Santos was introduced as the new national selector, he set up Femacosa, where he became managing partner. Thus, the coach did not enter into an individual employment contract, and the Federation hired this company to provide services to both the coach and his assistants.
The two years mentioned correspond to the victory of Portugal in the European Championship, which brought the said company a turnover of about 10 million euros. According to Expresso, 2.5 million euros were transferred to other companies created by MPs.
The breeder’s salary will be paid to him by Femacosa as managing partner and will be 5 thousand euros per month (70 thousand euros per year).
For the tax office, Femacosa has no real content and was created to reduce the tax burden of its main partner in this business, Fernando Santos. If the coach had received an individual employment contract, he would have been placed in a higher income group by the IRS, paying a higher amount of tax. Based on this work, the tax authorities took advantage of the general anti-abuse clause, disqualified the company for tax purposes and demanded another 4.5 million euros in IRS and interest from the selector, discloses To express.
Femacosa was founded on January 14, 2014. It is a consulting company in the field of trade, import, civil engineering and other activities.
The team’s Euro 2016 campaign went well and the FPF extended the contract by four years. With this extension, Femacosa became eligible for a €750,000 subscription premium.
Over the years, the company has retained and accumulated profits without distributing dividends, and by the end of 2020 (latest available data) reached a net worth of 17.6 million euros.
In 2018, new players appear in Femacosa. The sons, son-in-law and daughter-in-law of Fernando Santos become minority partners, while the national coach retained part of the quotas.
Em joint statement, the Portuguese Football Federation (FPF) and Fernando Santos condemned what they called “a gross and clearly truncated violation of the right to fiscal secrecy,” the statement said. “Fernando Santos not only doesn’t owe a cent to the tax authority, but he has never stopped settling his situation in accordance with the provisions of the law,” adds FPF.
Fernando Santos filed an appeal with the Arbitration Court in the person of Morais Leitao, who has accompanied him since at least 2014.
