Never an uneventful day in this season
If you woke up on the morning of April 22 wondering why your feed is filled with memes of F1 drivers going behind bars, here’s the big headline: Italian authorities is now looking to tax the fastest earners of the planet for consistently defaulting tax returns.
The Bolognese branch of Italy’s financial investigation unit, Guardia di Finanza has launched a large-scale investigation of tax evasion by every current and recent driver, and as the reports go, the defaults could add up to hundreds of millions of euros.
As of now, the Guardia di Finanza is looking into the earnings from races in Italy between 2020 and 2024, which includes races held at Monza, Imola and the 2020 Grand Prix at Mugello. Every foreign driver who is not on the current grid, but has raced on these tracks these last few years will be investigated. In fact, the department has already reached out to some of the drivers directly through letters, asking them to submit their tax returns for the 2025 tax year and discuss their obligations.
So under Italian tax law, non-resident Formula 1 drivers are considered to be self-employed freelancers as opposed to employees of their teams. The teams, as withholding agents, are required to make the necessary tax returns on the income generated from a race on Italian soil. While this has been a longstanding rule in the country, Italian lawyer Alessandro Mei lodged a formal complaint that the rule was not being efficiently implemented for F1 personnel. His claims come from preliminary findings by tax expert Emilio De Santis, whose analysis of Formula 1 income in the country was even picked up for discussion by the Italian parliament.
Italian authorities are now examining whether the teams correctly deducted and paid those taxes on behalf of drivers. In that sense, both teams and drivers are under scrutiny. By the Guardia. If the defaulted amount for a driver crosses €50,000 in taxes, it can trigger criminal charges: beyond recovering due tax, authorities can charge steep fines and prison sentences ranging from six months to five years, as per Italian law (Article 10 of Legislative Decree No. 74/2000).
Currently, the investigation is only in an administrative inspection stage. Should the Guardia di Finanza find anything on the drivers, a formal criminal investigation will be opened.
As of now, neither the FIA nor the teams or drivers have made any public statements on the incident. Either way, prison time for the drivers is less likely to happen. But Italian authorities have made one thing clear: it will recover the defaulted amount from the racers.
