Prepared by Paolo Lucarini, Lucia Zedda and Ciro Eligiato
The Italian Tax Authority, through an official answer to a tax ruling submitted by a “controesodato” taxpayer, confirmed the possibility to benefit by the favorable tax regime for impatriates under article 16, of Legislative Decree 147/2015 for a further five years, i.e. from the year 2021 to the year 2025.
The “controesodati” are those who have returned to Italy taking advantage of the tax incentives provided by Law n. 238 of 30 December 2020 (the so-called “Rientro dei Cervelli”) who have exercised the option provided by Article 16, paragraph 4, of Legislative Decree n. 147 that switched to the impatriate tax benefit, thus applying a 50% reduction of the taxable income related to employment income produced in Italy up to the year 2020.
With this clarification provided by the Italian Tax Authority, it is possible to have a more complete picture of the subjective scope of application of the extension of the benefit in question.
In particular, in addition to confirming the extension of the favorable tax regime for a further five years to the “controesodati”, the administration has also stressed – as already provided in the reference legislation – that this extension cannot be requested:
- By professional sportsmen;
- By those who moved to Italy starting from April 30 2019;
- By Italian citizens who returned on April 29 2019, and who were not registered to the AIRE during the period in which they qualified as no tax residents in Italy;
- By “controesodati” citizens who, despite having exercised the option under Article 16, paragraph 4, carry out business activities on Italian territory (limited to business income);
- By non-EU citizens.
As already stated in the Article 5, paragraph 2-bis, of the “Decreto Crescita” – it is important to underline that, through the answer to the tax ruling submitted, the Italian Tax Authorities have further clarified that, the failure to register the “controesodati” beneficiaries to the AIRE is an obstacle to accessing the extension of the above-mentioned tax regime for a further 5 tax years, despite the fact that this requirement was not included either among those required for access to the tax benefit under Law 238/10, or among those required for the exercise of the option under Article 16, paragraph 4, of Legislative Decree 147/15. This clarification has also been reiterated through other answer provided in the last few days to other petitions submitted by other “counter-expatriate” taxpayers.
The exercise of the option is subject to the payment of:
1. An amount equal to 10% of the income from employment and/or self-employment produced in Italy and subject to the relief, related to the tax period preceding the one in which the option is exercised if the taxpayer, at that time, meets the following requirements:
- He/she has at least one minor child, also in pre-adoptive foster care;
- Or he/she has become the owner of at least one residential real estate unit in Italy, subsequent to the transfer to Italy or in the twelve months preceding the transfer, or he/she becomes the owner within eighteen months from the date of exercise of the option, failing which the additional benefit enjoyed will be returned without the application of penalties.
2. An amount equal to 5% of the income from employment and/or self-employment produced in Italy and subject to the relief, related to the tax period preceding the one in which the option is exercised, if the taxpayer, at that time, meets the following requirements:
- He/she has at least three minor children, also in pre-adoptive foster care;
- And he/she becomes or has become the owner of at least one residential real estate unit in Italy, subsequent to the transfer to Italy or in the twelve months preceding the transfer, or he/she becomes the owner within eighteen months from the date of exercise, under penalty of the return of the same enjoyed without application of sanctions.
For a deeper discussion, please contact:
PwC TLS Avvocati e Commercialisti
PwC TLS Avvocati e Commercialisti