Spanish court clears Shakira in 2011 tax residency dispute, orders refund of fines

MADRID (AP) — A court in Spain has cleared Shakira of tax fraud and directed the state to hand back more than 55 million euros (about US$64 million) in penalties that should not have been levied, according to a ruling document reviewed Monday by The Associated Press.

The judgment caps a long-running tax fight in Spain involving the Colombian recording artist.

Judges in Madrid said the case centred on the 2011 tax year and that officials could not establish that Shakira counted as a Spanish tax resident that year. Under Spanish rules, a person is treated as resident only after spending more than 183 days in the country.

The court found that authorities documented just 163 days in Spain for Shakira in 2011 and told the Treasury to return the tax she paid on that basis, together with interest.

The tax agency had maintained that her ties to Spain at the time included a relationship with former footballer Gerard Piqué and that her principal economic activity was based in the country.

The High Court held that the partnership could not be treated in law as equivalent to marriage and that it was not shown that “the main center or base” of Shakira’s work or financial interests in 2011 lay in Spain, whether directly or indirectly.

“There was never any fraud, and the Tax Agency itself was never able to prove otherwise, simply because it wasn’t true,” Shakira, who had filed an appeal, said in a statement provided by her lawyers.

Her lawyer said Spain’s Treasury must now repay about 60 million euros (nearly US$70 million), including interest.

“This resolution comes after an eight-year ordeal that has taken an unacceptable toll, reflecting a lack of rigor in administrative practices,” her attorney, José Luís Prada, said in a statement.

In 2023, in a separate matter, Shakira struck an agreement with Spanish prosecutors to avoid trial on allegations that she failed to pay Spanish income tax totalling 14.5 million euros (then US$15.8 million) for 2012 through 2014.

She acknowledged those charges and paid 7.3 million euros on top of back taxes and interest already owed.

Shakira also surfaced in the 2017 Paradise Papers disclosures, which outlined offshore tax structures used by many public figures, among them Madonna and U2’s Bono.

Over roughly the past decade, Spanish tax officials have pursued several football stars, including Lionel Messi and Cristiano Ronaldo, for underpayment. Those athletes were convicted of tax evasion but did not serve prison time, under a rule that lets judges suspend sentences below two years for first-time offenders.