Real Madrid coach Carlo Ancelotti on Wednesday appeared in a Madrid court on the first day of his trial and denied deliberately committing tax fraud by allegedly failing to declare income to the Spanish tax authorities.
This case is the latest in a series targeting prominent figures in Spanish sports.
Prosecutors are seeking a prison sentence of four years and nine months for the 65-year-old Italian, accusing him of not paying over one million euros ($1.1 million) in taxes on earnings from his image rights in 2014 and 2015, during his initial tenure at the football club.
They contend that Ancelotti only declared his salary from Real Madrid and omitted income from his image rights in his tax returns during those years.
The prosecution alleges that the Real Madrid coach established a “confusing” and “complex” network of shell companies to conceal his additional income from image rights and other sources, such as real estate, during this period.
However, Ancelotti informed the High Court of Justice in Madrid that this payment structure was proposed to him by Real Madrid and that “all the players do it,” as did former coach Jose Mourinho.
He stated, “When the club suggests it to me, I put Real Madrid in touch with my advisor. I didn’t deal with it because I had never been paid that way.
“I never realised that something wasn’t right,” Ancelotti added, asserting that he “never considered committing fraud.”
He was accompanied to court by his wife, Mariann Barrena, and his son, Davide, who serves as the assistant manager at Real Madrid.
The trial is expected to last two days, but the involved parties could reach an out-of-court settlement at any point.
Previous similar cases involving football players have often resulted in suspended sentences through such agreements.
Ancelotti told the court that he was unaware that the company set up to manage his image rights allowed him to pay less tax.
He said, “At that time, all the players and coaches were doing it that way; it seemed like the right thing to do.”
Spain has intensified its efforts in recent years to crack down on top football players who have not paid their taxes.
Mourinho received a one-year suspended sentence after pleading guilty to tax fraud in 2019.
Lionel Messi and Cristiano Ronaldo were also found guilty of tax evasion and received prison sentences that were waived as they were first-time offenders.
In 2023, Colombian singer Shakira agreed to a three-year suspended sentence and paid 7.3 million euros in fines to settle a tax fraud case and avoid trial.
She had been accused of defrauding the Spanish state of 14.5 million euros on income earned between 2012 and 2014, charges she denied.
Ancelotti’s first stint as Real Madrid coach was from 2013 to May 2015, after which he managed Bayern Munich.
The former Italian international midfielder, a two-time European Cup winner as a player with AC Milan, has also managed Napoli and Everton before returning to Real Madrid in 2021.
His managerial achievements include winning domestic league titles with Real Madrid and Milan, Chelsea in England, Bayern Munich in Germany, and Paris Saint-Germain in France, in addition to his success in the Champions League.
