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Tag Archive for Italy

Tax Alert (Italy) – Budget Law For 2018 Introduces Major Developments To Domestic Tax System

This is the sixth of a series of posts on the major developments introduced by Law No. 205 (enacting the Italian Budget Law for 2018),

Individual taxation – Step-up of tax value of non-substantial participations in unlisted Italian companies

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Tax Alert (Italy) – Budget Law For 2018 Introduces Major Developments To Domestic Tax System

This is the fifth of a series of posts on the major developments introduced by Law No. 205 (enacting the Italian Budget Law for 2018),

Individual taxation – Regime applicable to dividends and capital gains derived from individuals outside a business capacity

The current tax regime applicable to dividends and capital gains, realized by individuals acting as non-entrepreneurs, depends foremost from the type of qualification that the holding assumes in the hand of the individual. Read more

Tax Alert (Italy) – Budget Law For 2018 Introduces Major Developments To Domestic Tax System

This is the fourth of a series of posts on the major developments introduced by Law No. 205 (enacting the Italian Budget Law for 2018),

Individual taxation – Modification of black-list criteria for CFC purposes: taxation of profits accrued and distributed in different fiscal periods and under different rules Read more

Tax Alert (Italy) – Budget Law For 2018 Introduces Major Developments To Domestic Tax System

This is the third of a series of posts on the major developments introduced by Law No. 205 (enacting the Italian Budget Law for 2018),

Corporate taxation – Partial exemption of dividends distributed by CFCs.

According to current Italian rules, profits realized by non-resident subsidiaries are deemed to exist under the CFC legislation (article 167(4) of the ITA) if the relevant nominal rate in the foreign jurisdiction (other than EU and EEA countries) is lower than 50% of the combined IRES tax (rate 24%) and IRAP tax (rate 3,9%). Read more

Budget Law For 2018 Introduces Major Developments To Domestic Tax System- Part II

This is the second of a series of posts on the major developments introduced by Law No. 205 (enacting the Italian Budget Law for 2018)

Corporate taxation – Changes to calculation of EBITDA for deduction of any excess of interest expenses Read more

Mamma Mia! Italian Tax Court Rules On Inter-Company Loan Interest Withholding Tax, Beneficial Owner Withholding Exemption

Marco Rossi, Tax Advisor

With its Ruling n. 4091 of June 12, 2017, the Eighth Department of Tax Commission (District Tax Court) of Milan, Italy ruled that upon the cancellation of an inter company loan from a Dutch parent company to its Italian subsidiary, the interest accrued on the loan and deducted by the Italian subsidiary on an accrual basis, during the course of the loan, is deemed “constructively received” by the foreign parent, and is potentially subject to the Italian interest withholding tax (at the rate of 20 percent, pursuant to article 26, paragraph 5 of Presidential Decree n. 600 of 1973, recently increased to 26 percent).

However, the Tax Court also ruled that the Dutch parent company qualified as “beneficial owner” of the interest, and was eligible for the withholding tax exemption granted under article 26-quater of Presidential Decree n. 600 of 1973, which implemented the EU Directive n. 2003/49/CE (so called interest and royalties directive).

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Italy Implemented The IV Anti-Money Laundering Directive

Marco Rossi, Tax Advisor

With the Legislative Decree n. 90 of May 25, 2017, published on June 19, 2017 Italy finally adopted and transposed into its own legal system the EU Directive 2015/849, usually referred to as the “IV Anti Money Laundering Directive”.

One area that attracts particular attention concerns the new reporting rules applicable to trusts.

Article 21, paragraph 3 of Decree n. 90 provides that “trusts producing juridical effects relevant for tax purposes, in accordance with article 73 of the Presidential Decree n. 917 of January 22, 1986, shall be registered with a special section of the Register of Enterprises”.

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Italy’s Tax Issues Guidance On Taxation Of Neo-Tax Residents

Marco Rossi, Italy, Tax

With Circular 17/E of May 23, 2017, Italy’s Tax Agency provided administrative guidance on the interpretation and application of the provisions on the elective preferential tax regime for Italian new-tax resident individuals.

New article 24-bis of Italy’s Unified Income Tax Code, enacted with Law n. 232 of December 2016, provides that foreign-resident individuals who establish their tax residency in Italy, after having been resident in a foreign country for at least nine of the previous ten tax years, may elect to pay a fixed-amount tax of euro 100,000 on all of their foreign source income, in lieu of the ordinary Italian personal income tax. Domestic source income would remain subject to the ordinary personal income tax, charged at graduated rates on income tax brackets. Read more

Italy: New Tax Rules For New Resident

The Italian Government designed a new flat tax, under the new Article 24 bis of TUIR (consolidated law on income tax) introduced by the new Italian Budget Law 2017. The aim of this law is to revive the economic fortunes of Italy by making the country competitive with countries such as England and Spain, which have faired better in terms of cost savings and tax benefits. The Flat Tax law is designed to attract foreign persons and wealthy taxpayers that have never resided in Italy to invest in the country by not only giving incentives by way of tax rebates, but also with the splendour of Italian culture and food. Read more

Italy’s New Flat Tax For First-Time Residents

Marco Rossi

With the Budget Law for fiscal year 2017, Italy enacted a new flat tax for Italian first-time residents. The flat tax amounts to euro 100,000 regardless of the amount of taxable income. Foreign source income is completely exempt from tax, while domestic source income is taxed under the normal rules (graduated tax rates on income brackets generally applying to all resident taxpayers).

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Italian Supreme Court Ruling On Beneficial Ownership

Marco Rossi

With its ruling n. 27113/2016 issued on December 28, 2016, the Italian Supreme Court interpreted and applied the beneficial ownership provision of article 10 of the tax treaty between Italy and France, for the purpose of determining whether a French holding company, wholly owned by a U.S. corporation, was entitled to the imputed credit granted under that treaty in respect of dividends received from an Italian subsidiary.

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Italy Institutes New Register For Trusts

Marco Rossi,

Under new anti-money laundering legislation due to become effective in Italy in 2017, all foreign trusts with tax effects in Italy shall have to be filed and registered on the Italian Register of Enterprises. They include trusts with Italian settlor, Italian beneficiaries, Italian assets, Italian source income or treated as Italian resident trust under Italian tax law.

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