Superstar footballer Cristiano Ronaldo has agreed to settle his tax fraud case with Spanish authorities for €18.9 million (£16.8 million).

Ronaldo, who recently signed with Italian Seria A champions Juventus for €100 million, will pay the settlement alongside a two-year suspended jail sentence, having pleaded guilty to the charges in 2017.

Miles Dean commented:

“It appears Cristiano Ronaldo set up and owns, either directly or via a trust or foundation, a British Virgin Islands (BVI) company. Ronaldo has then sold and/or assigned his image rights to said BVI company, prior to becoming resident in Spain.

“This BVI company licenses the image rights to Multisports Image Management (MIM), an Irish company subject to Irish corporation tax. Ronaldo doesn’t own or control MIM – it is an unrelated third party licensing company that exploits the image rights.

“There are two key reasons that Ireland was used. Firstly, it has an extensive double tax treaty network that allows royalties to be paid subject to reduced rates of withholding tax.

“Secondly, under domestic Irish law most royalty payments are not liable to Irish withholding tax – even though the BVI company doesn’t benefit from a double-taxation agreement with Ireland, MIM can pay most of its income out to the BVI company without having to deduct Irish withholding tax.

“Ronaldo claimed the benefits of the Beckham law, which exempts non-Spanish source income for a period of six years.

“If the BVI/Irish structure actually had non-Spanish source income then Ronaldo has been stitched up. However, if MIM received Spanish source royalties, Ronaldo is bang to rights and should sue his advisers.”

Read Miles’ comments in economiaWealth Manager and Inside World Football