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F1 2023

Where does the penalty money in F1 go?

It is a regular occurrence during a Formula 1 season that teams and drivers receive a fine. But what happens to the money that is collected by the FIA?

Start sprintrace Brazil 2022
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For many F1 teams, it may come as a relief to be handed a fine rather than a performance-related penalty for an offence. But where does the money that the FIA collect on these occasions go?

Max Verstappen once joked that the stewards could enjoy a nice dinner after he was fined €50,000 for touching the rear wing of Lewis Hamilton's Mercedes in parc ferme over the 2021 Brazilian Grand Prix weekend. However, this is obviously not how the money is used.

Instead, the FIA ensures that any penalty money received goes towards supporting various projects, as the governing body explained to RacingNews365.com.

"The FIA is a not for profit organisation, and as such, all revenues above our operating costs are put towards grass roots development projects such as the low-cost Cross Car initiative, FIA University, the Engineering Scholarship Programme, and projects and initiatives which support of our Member Clubs," they stated.

FIA cannot make money from F1

It was stipulated by the EU in 2001 as a condition for approving the commercial rights deal between the FIA and Formula 1 that the governing body cannot make money from F1.

The EU enforced that sporting and commercial activities had to be strictly separated. In other words, the FIA was not allowed to interfere in F1 financial matters.

When asked what was done with the $7 million fine imposed on Red Bull for breaching the 2021 budget cap, the FIA indicated that it does not go into detail about where the money from each individual fine goes.

In any case, there is no separate fine pot, but the money collected is counted under overall revenue, with anything more than the cost of running the business thus being invested elsewhere.

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Check out our handy explainer video below.


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