The singer Miguel Bosé must pay the Tax Agency a fine of more than 23,000 euros after the Superior Court of Justice of Madrid has confirmed the claims for the settlement of taxes for 2010 and 2011 in which he deducted expenses such as hams, training and physiotherapy.
The Administrative Litigation Chamber of the Madrid Supreme Court has dismissed two appeals filed by Bosé, administrator of Costanagua SL, a company dedicated to the production and management of the singer’s artistic activities, against decisions of the Regional Economic Administrative Court of Madrid.
One of the decisions confirmed by the Supreme Court referred to the claims regarding the VAT settlement of 2010 and 2011, for 55,350 euros, and the penalty imposed on Bosé, derived from the previous one, for 23,536.87 euros. The second is the one relating to the two Corporation Tax settlement agreements for the same fiscal years, for 62,962 euros.
Improper deductions
According to the decisions of the Administrative Economic Court, now confirmed by the Madrid TSJ, the deductions that were applied to the liquidations did not proceed since they were personal expenses of the sole partner of the company, that is, Miguel Bosé.
Among the invoices whose deduction the Tax Agency denied for being Bosé’s personal expenses are those related to physiotherapy treatments and physical training, “which are not related to the activity carried out by the company (Costanagua) as they are obvious personal expenses of his partner and sole administrator “, says the sentence.
Nor does it admit those of the invoices related to the purchase of Iberian products (ham and loin) since, apart from the fact that the expenses of representation and gifts are not deductible, there is no evidence of any relationship of those expenses with the income of the company, he emphasizes sentence.
There are others that correspond to the installation of a closed circuit domotic television that, says the court, “it is clear, once again, that it was a security service provided in the private home” of Bosé, without having any relation to the activity of the society.
And the fact that Costanagua “states that he had rented a part of the house for his activity, is only reflected in a private lease document with the effectiveness and proof that said documents have (…) and, in any case, it would deal with services used simultaneously to satisfy private and professional needs, “the court maintains.
Regarding the expenses associated with the “renting” of an Audi vehicle, it indicates that its usual driver was Ignacio Palau Medina, (the artist’s ex-partner) “without clarifying in the lawsuit what was the employment relationship with the plaintiff entity and what their functions in the company consisted of, and without stating payroll or means of payment thereof “. And as the Tax Agency points out, the vehicle’s insurance policy was listed as “private” use.
The rest of the expenses related to repairs of a Toyota vehicle and another Mercedes brand are also rejected, since there is no record that they were for the activity of the company since the professional trips of Bosé and his musicians were made with rental vehicles with driver .
No professional activity
The TSJM indicates that Costanagua did not carry out any professional activity and it was carried out by Bosé, since all the contracts made by it had the purpose of developing its professional activity and were carried out exclusively on the basis of that activity.
Thus, the sentence adds, that activity could have been carried out directly by the natural person, “without the need to interpose any company for it, inasmuch as the company did not provide any professional activity.”
“It is evident that there is no legal prohibition in relation to the provision of professional services through commercial companies, but what the rule does not cover is that a company is used to bill the services that a natural person performs, with the sole purpose to reduce the direct taxation of the professional “, he highlights.
