European Union and Italian International Tax Law Blog

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European Union and Italian International Tax Law Blog

Preview of Italy’s Register of Beneficial Owners

January 26, 2020

On December 23, 2019, the Italian Ministry of the Economy and Finance published on its web site a draft of the Ministerial Decree setting forth the provisions for the establishment and operation of the Register of Beneficial Owners of business entities, non-commercial entities and trusts. The establishment of the Register of Beneficial Owners is required by article 21 of the Legislative Decree n. 231 of November 21, 2007, which contains the domestic legislation implementing the…

European Union and Italian International Tax Law Blog

Italian Tax Agency Proposes 1.4 Billion Euro Tax Assessment on FIAT-FCA Merger

By Marco Rossi

December 11, 2019

News broke out that Italian tax auditors have issued a proposed tax assessment for Euro 1.4 billion ($1.6 billion) as additional corporate income tax due from Fiat Chrysler Automobiles N.V. (“FCA”), in connection with the merger between FCA and FIAT S.p.A. (“FIAT) carried out in 2014, after FIAT had completed its acquisition of US automaker Chrysler. FCA was incorporated in the Netherlands, and established its tax domicile in the UK, to carry out the reorganization…

European Union and Italian International Tax Law Blog

Italian Supreme Court Upholds Ruling Denying Dividend Withholding Tax Exemption, Treaty Rate Reduction

By Marco Rossi

November 9, 2019

By way of ruling n. 25490 issued on October 10, 2019 (Supreme Court Ruling 25490 of 10-10-2019), Italy’s Supreme Court upheld the appellate court’s ruling which denied both the dividend withholding tax exemption of the EU Parent Subsidiary Directive n. 435/90/CEE of the Council dated July 23, 1990 (the “Directive”), and the dividend withholding tax rate reduction granted under article 10 of Italy-Luxembourg tax treaty (the “Treaty”), for dividends paid by an Italian…

European Union and Italian International Tax Law Blog

Italy Enacts New Provision On Taxation Of Distributions From Foreign Trusts

By Marco Rossi

November 2, 2019

Law Decree n. 124 of October 26th, 2019 (which is immediately effective, but needs to be converted into law within 60 days to become final) includes, at article 13, new provisions on taxation of certain distributions from foreign trusts to Italian resident beneficiaries (individuals and non-business entities). By way of background, Italy does not have its on law on trust, but it recognizes and gives effects to trusts established under foreign law, pursuant to the…

European Union and Italian International Tax Law Blog

No Gift Tax On Transfer Of Property To Trusts, Italian Supreme Court Rules, Creating New Challenges and Planning Opportunities

By Marco Rossi

October 26, 2019

By way of thirteen decisions issued in June and July (numbers 15451, 15453, 15455, 15456 of June 7, 2019, numbers 16699, 16700, 16701, 16702, 16703, 16704, 16705 of June 21, 2019, no. 19167 of July 17, 2019 and no. 19319 of July 18, 2019), the Italian Supreme Court ruled that the Italian gift tax does not apply to the transfer of property to a trust, at which time the gift is to be regarded as…

European Union and Italian International Tax Law Blog

Italian Tax Agency Rules on Merger Leveraged BuyOut, Denies Interest Withholding Exemption Under Beneficial Ownership Clause

By Marco Rossi

October 20, 2019

With its tax ruling n. 88/E of October 18, 2019 (Ruling 88-2019), the Italian Tax Agency denied the interest withholding tax exemption provided for in the EU Interest and Royalties Directive, in respect of interest due by an Italian Target on a shareholder’s loan extended from its EU Parent in connection with a merger leveraged buy-out transaction carried out in Italy. A EU-based holding company (Purchaser) set up and Italian acquisition vehicle (NewCo),…

European Union and Italian International Tax Law Blog

Holding Company’s Tax-Free Reorganization Does to Jeopardize Dividend Withholding Exemption, Italy’s Tax Agency Rules

By Marco Rossi

September 29, 2019

In its Ruling N. 380 of September 11, 2019, Italy’s Tax Agency provided its guidance on certain tax implications of a corporate reorganization pursuant to which a Luxembourg holding company, which owns an Italian company, would reincorporate into Switzerland and convert into a Swiss tax resident company. Prior to the reincorporation of the holding company in Switzerland, the dividends paid by the Italian subsidiary to its Luxembourg parent were exempt from Italian withholding tax…

European Union and Italian International Tax Law Blog

Italian Tax Agency Rules on Tax Effects of Early Termination of Trust, Treats It As Gift Back to Settlor Subject to Gift Tax

By Marco Rossi

September 14, 2019

In its Private Letter Ruling n. 355 of August 30, 2019 the Italian Tax Agency considered the tax implications, for Italian gift tax purposes, of a transaction involving the early termination of an irrevocable trust by way of mutual consent of the trustee, settlor and beneficiaries of the trust, with a return of the trust’s assets to the settlor. The Tax Agency treated the termination of the trust as a gift of the trust’s assets…

European Union and Italian International Tax Law Blog

Italian Tax Residence For Individuals: A Refresher And Look At Open Issues And New Matters

By Marco Rossi

August 23, 2019

Italian tax residence is a very important topic for foreign nationals who travel regularly to Italy, own houses and spend significant time with their family there, while living and working abroad, as well as for those who relocate to Italy and work, do business or just retire there. For the former, it may be surprising to know that they may have crossed the line and become Italian tax residents, under Italian tax law, even though…

European Union and Italian International Tax Law Blog

Italian Substituted Tax On Financial Income At Odds With Tax Treaties

By Marco Rossi

August 11, 2019

Italy taxes various categories of financial income – namely dividends, interest and capital gains – earned by private investors outside the carrying on of a trade or business, by way of a substitute tax charged on the gross amount of the income at the flat rate of 26 percent. With effect from January 1, 2018, capital gains are no longer categorized as gains realized from the sale of qualified shareholdings (i.e., shareholdings exceeding a minimum…

European Union and Italian International Tax Law Blog

Blog Authors

Preview of Italy’s Register of Beneficial Owners

Italian Tax Agency Proposes 1.4 Billion Euro Tax Assessment on FIAT-FCA Merger

Italian Supreme Court Upholds Ruling Denying Dividend Withholding Tax Exemption, Treaty Rate Reduction

Italy Enacts New Provision On Taxation Of Distributions From Foreign Trusts

No Gift Tax On Transfer Of Property To Trusts, Italian Supreme Court Rules, Creating New Challenges and Planning Opportunities

Italian Tax Agency Rules on Merger Leveraged BuyOut, Denies Interest Withholding Exemption Under Beneficial Ownership Clause

Holding Company’s Tax-Free Reorganization Does to Jeopardize Dividend Withholding Exemption, Italy’s Tax Agency Rules

Italian Tax Agency Rules on Tax Effects of Early Termination of Trust, Treats It As Gift Back to Settlor Subject to Gift Tax

Italian Tax Residence For Individuals: A Refresher And Look At Open Issues And New Matters

Italian Substituted Tax On Financial Income At Odds With Tax Treaties

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