(Refiles to change headline verb to probe)
MILAN May 25 (Reuters) - Italian financial police have notified Dolce & Gabbana of steps to recover taxes on what the designer duo described as a "completely abstract" 800 million euros ($1.12 billion).
Domenico Dolce and Stefano Gabbana, among Milan's top fashion names, said in a statement the issue stemmed from the sale of their brands in 2004, for which they received 360 million euros.
Financial police in the last few days "notified us of a request to recover taxation for 2004 on 800 million euros. It's an absurd demand based on a completely abstract calculation", said the designers, known for their use of gold and baroque embellishments.
They denied any wrongdoing, saying, "This higher taxable sum ... is a virtual figure we have never received, the result of a theoretical accounting exercise."
A source close to the matter told Reuters on Saturday the pair were being investigated for a tax matter that had no criminal implications.
The source said the Milan financial police had sent a report to the government's tax agency, which would decide what to do.
(Editing by Will Waterman)
((Milan newsroom +39 02 6612 9507, fax +39 02 801 149, email@example.com))
($1=.7145 Euro) Keywords: DOLCEGABBANA/
(C) Reuters 2009. All rights reserved. Republication or redistribution ofReuters content, including by caching, framing or similar means, is expresslyprohibited without the prior written consent of Reuters. Reuters and the Reuterssphere logo are registered trademarks and trademarks of the Reuters group ofcompanies around the world.nLP415530