One of the most well-known organizations in the world (also involved in the upcoming Worlds of League of Legends), the Fnatic, seems to have ended up under the magnifying glass of the Swedish tax authorities for the fiscal period 2016-2017.
It appears to have been fined more than one million crowns, corresponding to around 90,000 euros, by the Swedish tax agency for not having paid taxes on players’ salaries for the years in question.
Fnatic is the second Swedish organization whose name has entered the tax documents of the Scandinavian country. Earlier this year, a former Ninja employee in Pajamas reported a very similar thing about his former organization, for not paying taxes on behalf of his players.
The Swedish Revenue Agency began its investigation after the organization’s players stated that payroll taxes had been paid by Fnatic in the relevant tax declaration. In addition, the agency also found that players had to be covered by Swedish social insurance, even though the Fnatic had never done any application for it.
This led to a confusion between the tax situation of the organization and the declarations of the players which led to discrepancies such as to arouse the interest of the Agency.
The Inland Revenue then filed a lawsuit against the Fnatic at the administrative court. At the time of the hearing, the organization stated that it was the player’s responsibility to pay taxes and the organization is not responsible for the proposed fees. Although the court ruled that the organization was actually responsible for paying employer contributions and tax supplements.
In the sentence, the judge imposed the fine on the organization and ordered to reimburse the amount due. The Fnatic have about two months to appeal against the court ruling, but at the moment it is unclear whether they will seek a settlement agreement or appeal to the court decision.