POSTPONEMENT DECREE
With the Postponement Decree (Decree-Law n. 132 as of 29 September 2023), the following expiry dates have been postponed:
- 31 October 2023 regarding the payment of taxes, social security contributions and mandatory insurance premiums due between 4 and 31 July 2023 by taxable persons, whose residence or registered office - on 4 July 2023 - was located in one of the municipalities of the region Lombardia, which were affected by the weather events causing the emergency-declaration by resolution of the Council of Ministers as of 28 August 2023;
- 15 November 2023 regarding the recalculation of the value of crypto-assets;
- 30 November 2023 regarding the favourable distribution to shareholders and the favourable conversion.
However, the expiry date for the tax credit's set-off was preponed from the initial expiry date on 31 December 2023 to 16 November 2023. Said tax credit regards:
- the 1st quarter 2023 (section 1 Decree-Law 197/2022),
- the 2nd quarter 2023 (section 4 Decree-Law 34/2023),
intended in support of the companies in the purchase of electricity and natural gas.
ENERGY DECREE
VOLUNTARY CORRECTION OF ERRORS - PROCEEDS
The energy decree (Decree-Law no. 131 as of 29 September 2023) provides that the taxpayers, who have been in breach of one or more principles in relation to the certification of daily proceeds pursuant to section 6 Legislative Decree 471/1997:
- (2-bis) (omitted or incorrect storage and submission of electronic proceeds),
- (3) (lack of issue of tax receipts and transportation documents),
between 1 January 2022 and 30 June 2023, may avail themselves of the voluntary correction of errors pursuant to section 13 Legislative Decree 472/1987, even if the breaches have already been contested (e.g., via formal notice of assessment (ital.: "PVC")), no later than 31 October 2023. The foregoing applies, if:
- the breaches had not been contested before the date of completion of the voluntary correction of errors (e.g., via penalty application notice pursuant to section 16 Legislative Decree 472/1997) and
- said completion is made by 15 December 2023.
The corrected breaches are not relevant with regard to the calculation of the additional penalty pursuant to section 12 (2) Legislative Decree 471/1997 (suspension of the licence or authorization to carry out operations or business from 3 days to 1 month).
ENERGY-INTESIVE BUSINESSES
The prerequisites for adhering to the advantageous scheme have been re-established as of 1 January 2024. Furthermore, the benefit is no longer composed in a gradual manner according to the individual company's energy intensity, but a unit value is provided for all companies holding certain conditions.
DIRECT TAXES
CONVENTIONAL SALARY IN THE EVENT OF SECONDMENT
With regard to the conventional salary for work performance carried out abroad on a regular basis and as the sole and main purpose of the employment relationship, the tax scheme pursuant to section 51 (8-bis) of the Italian Tax Code (TUIR) continues to be applicable if the employee carries out occasional business trips to Italy due to the company's needs and in the interest of the foreign company receiving the secondment only (Italian tax authority, answer to ruling application no. 428 as of 12 September 2023).
PENALTIES NON-TRANSFERABLE TO THE SHAREHOLDERS
According to the principle of personal liability, in the event of cancellation of the company from the companies' register and the following extinction of said company, the penalties cannot be transferred neither to the shareholders nor to the liquidator.
Said principle has become even more significant thanks to section 7 Decree-Law 269/2003 that introduced the exclusive reference of the administrative tax penalties to the legal person (Supreme Court ruling no. 24316 as of 9 August 2023).
UTILISATION OF THE TAX CREDIT TRANSFERRED TO ITALIAN AND WORLDWIDE TAX CONSOLIDATION SCHEMES
The tax credit accrued following the distribution of the so-called revaluation reserves "under tax suspension", may be:
- transferred to the consolidating company for a total amount not exceeding the Italian corporate tax (IRES) resulting from the consolidated tax return as account and final balance, and
- used for set-off for an amount not exceeding the limit of 2 million euros pursuant to section 34 Law 388/2000 (Italian tax authority, answer to ruling application no. 436 as of 26 September 2023).
DEADLINE FOR THE SUBMISSION OF THE DOCUMENTATION FOR THE PURPOSE OF WITHHOLDING TAX EXEMPTION FOR "PARENT-SUBSIDIARY" DIVIDENDS
The late submission (after the payment of the dividends) of the certificate issued by the foreign tax office does not affect the parent company's right of exemption from withholding tax on Italian source dividends, as the conditions of the Parent-Subsidiary Directive pursuant to section 27-bis DPR 600/1973 are met at the moment of receipt of the dividends (Supreme Court ruling no. 27646 as of 29 September 2023).
VAT
DEDUCTION
A non-resident company, which:
- has acquired goods from a non-resident company and
- has paid VAT on said purchases as they are VATable in Italy, documented by invoices with specification of VAT,
is entitled to a VAT refund, even though the non-resident transferor-company has only subsequently appointed a tax representative in Italy. This is due to the fact that neither the direct identification nor the appointment of a tax representative is integrally recognised for the purpose of the exercise of the rights and obligations arising from the EU VAT-provisions (Italian Supreme Court order 20738 as of 18 July 2023).
CORPORATE LAW
CAPITAL ACCOUNT CONTRIBUTIONS FOR FUTURE CAPITAL INCREASE TO BE REIMBURSED IF NO CAPITAL INCREASE OCCURS
The Italian Supreme Court returned to the issue of capital account contributions for future capital increases and recalled that all money contributions by shareholders made in favour of the company are not deemed finally acquired to corporate equity, since they are destined to a specific purpose. Consequently, if such purpose is no longer achieved (i.e., if no capital increase occurs), the shareholder shall be entitled to be reimbursed its payments, since the reason that justified the allocation to corporate equity made in favour of the company is no longer given.
This order also specifies that a money contribution is deemed a capital account contribution for future capital increase, if the parties' will is clearly and unmistakeably to subordinate the payment made to a capital increase. Such assessment is made by using indexes such as the specification of a final deadline for a resolution on the capital increase, the parties' behaviour, annotations, if any, to the accounting records or the notes to the financial statements, provisions in the articles of association, if any, as well as any other concrete circumstance that confirms the parties' common intention and the interests involved. Such assessment may not be based on the sole description used in the accounting records only (Italian Supreme Court order 24093/2023).
DISMISSAL FOR ECONOMIC REASONS, WIDER SCOPE OF REPÊCHAGE
The Italian Supreme Court provided a new and wider interpretation of the so-called repêchage set forth for companies in the event of dismissal due to justified objective (economic) reasons and widened the scope of such obligation to include also future, but foreseeable circumstances at the time of withdrawal notice. Furthermore, the Supreme Court emphasized that the burden of proof of the impossibility of repêchage lies with the employer. Since this legal instrument has never been included in Italian or Community-law legal acts, this Supreme Court decision might be destined to have a particular weight in litigations (Italian Supreme Court ruling no. 12132/2023).
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Yours sincerely,
HAGER & PARTNERS