On 2 October 2026, the Supreme Court (Sentencia 1102/2026) ruled in favor of Club Atlético de Madrid in a €14.3M dispute with the Tax Agency over payments to football agents (intermediaries) for player transfers between 2018-2021. The AEAT had argued that agent fees paid by the club on behalf of players constituted “in-kind remuneration” taxable to the player at 47% IRPF (non-resident 24% for foreign players), while the club deducted them as staff costs. The Court held that under FIFA Football Agent Regulations (FFAR) and Spanish Royal Decree 1006/1985, the agent’s *mandate* is dual: representing the club for transfer negotiations and the player for personal terms. Absent explicit player-club agreement assigning the fee to the player, the payment is a club business expense (deductible under Article 15 LIS) and not player income. The ruling mandates proportional allocation based on service breakdown in the representation contract.
Key Takeaways
- Contractual Clarity Required: Clubs and players must explicitly allocate agent fees in tripartite agreements (club-player-agent) specifying % for club services (transfer) vs. player services (contract, image rights).
- VAT Treatment: Agent services to clubs are B2B (reverse charge); to players, B2C (21% VAT). The ruling implies clubs should contract agents directly for transfer services to avoid VAT leakage.
- International Precedent: This aligns with UK FTT (Newcastle United, 2023) and German BFH (Bayern Munich, 2024) decisions, creating a consistent European framework for football taxation.
Disclaimer: This article is compiled and summarized by the AI based on publicly available information and is for general information purposes only. It does not constitute any form of formal tax advice, legal opinion, or basis for performance. Please consult a qualified professional tax advisor or legal counsel for tax advice.
Source: Read Official Announcement