Carlo Ancelotti faces trial for tax evasion charges in Spain

In March 2024, the Spanish prosecutors launched a trial against Real Madrid coach Carlo Ancelotti for tax evasion. Ancelotti, an accomplished Italian soccer coach, is accused of defrauding the state of 1 million euros ($1 million) during the years 2014 and 2015. The prosecutor is seeking a significant prison sentence of four years and nine months due to two counts of tax fraud which involve allegations that he used shell companies to obscure his actual income from image rights revenue. This trial is part of a larger trend in Spain, where several high-profile soccer figures have faced scrutiny for alleged tax fraud. During his testimony, Ancelotti firmly maintained his belief that his tax affairs were managed legally, stating he had never intended to commit such fraud. He explained that, upon joining Real Madrid, arrangements regarding his salary were handled by the club and his British advisor, and he believed this structure was standard practice among players and coaches at that time. He noted that he reported his salary but inadvertently omitted income linked to image rights, which he claims are not as substantial for coaches compared to how they are for players. This distinction was key to his defense as he sought to clarify the nature of his tax reporting. The prosecution further argued that Ancelotti, like many others in the high-profile soccer industry, needed to be careful about transparency in income reporting. The trial sees not just Ancelotti but also his family providing testimonies, outlining the personal impacts of such allegations. Ancelotti’s case falls into the broader narrative of tax fraud investigations targeting soccer stars, including figures like Cristiano Ronaldo, who opted to settle their disputes outside of court. As of now, Ancelotti's case is still unfolding in court, with a verdict to be anticipated in a few weeks. The implications of the trial go beyond personal repercussions for Ancelotti; it raises questions regarding the financial integrity within the elite sectors of professional sports in Spain. The need for compliance with tax regulations becomes ever crucial as legislative measures tighten over earnings and the scrutiny of clubs and their staff intensify. The outcomes may have lasting effects not only on Ancelotti’s career but also on norms and practices across football and its management in Spain.