Additional payment in the millions?
The tax office revokes DFB’s non-profit status for two years
01/19/2023 9:56 p.m
The scandals of the past won’t let go of the German Football Association. After 2006, the DFB’s non-profit status was also revoked for the years 2014 and 2015. The tax office is therefore demanding a two-digit million amount, the association is fighting back – but is prepared.
The tax office in Frankfurt am Main has revoked the non-profit status of the DFB for the years 2014 and 2015 – the German Football Association is threatened with additional tax payments in the double-digit million range. The association itself announced the expected step by the authority, immediately after the dispatch to the return of Rudi Völler to the men’s national team.
“As a precaution, the DFB had made provisions in its budget for the resulting additional demands from the tax authorities,” it said in a press release.
The association is therefore accused of tax evasion by the tax authorities in connection with income from the perimeter advertising of the years in question. DFB treasurer Stephan Grunwald had already said at the beginning of November that the non-profit status was threatened for the period in question.
DFB diligently forms reserves for various problem areas
Grunwald emphasized at the time that no incorrect information had been given in the tax returns at issue. He spoke of 26 million euros in possible additional tax payments for this matter, but the DFB is not threatened with insolvency: the association has liquid funds in the three-digit million range. Grunwald reported that the DFB had to set up reserves of more than 46 million euros due to other tax-related transactions. Therefore, a minus in the double-digit million range is to be expected in the balance sheet for 2021.
In addition to the allegations of tax evasion in connection with the booking of perimeter advertising in the years in question, according to Grunwald, these are the transfer of name and logo rights in sponsorship (Adidas) and the entertainment costs that have been incorrectly taxed for ten years. The name and logo rights were assigned to tax-free asset management. As the DFB concedes, 100 percent of the entertainment costs were claimed. Only 70 percent would have been allowed.
The DFB is already taking legal action before the Hessian Finance Court in Kassel against the 2017 deprivation of non-profit status for 2006 and the resulting subsequent tax payment of around 22 million euros. The association had been accused by the financial authorities of having wrongly claimed a payment of 6.7 million euros to the world association FIFA for the organization of a World Cup opening gala in 2005 as an operating expense.