Business Tax
9.1 Corporate Taxation Italian companies are subject to two main taxes: Taxable income is calculated according to Italian GAAP, with adjustments for non-deductible expenses and exemptions. Losses may be carried forward indefinitely, subject to limits. 9.2 VAT and Indirect Taxes Italy applies a standard VAT rate of 22%, with reduced rates (10%, 5%, 4%) for […]
Withholding Tax Rates Under Italy’s Double Taxation Agreements (DTAs)
Tax to be Withheld on Payments to Non Residents Italy has an extensive series of rules requiring Italian tax resident businesses and professionals to make withholding of tax on certain payments of various types of income, both where the recipient is tax resident in Italy and non tax resident. Italy has an extensive network of […]
Italian Source Income – Definition
The Importance of Identifying Italian Source Income The Italian tax Code contains a specific definition of Italian source income – or rather a list of types of income that are deemed under the Italian Tax Code to have an Italian source. If you are tax resident in Italy for any tax year (under the test […]
Italian tax aspects of renting Italian real estate – for landlords
Introduction This guide briefly sets out the main issues arising on the short term (<30 days) rental of residential (i.e. non commercial/agricultural) accommodation, located in Italy. This guide does not cover the situation where you are purchasing real estate to run a business (except under the Regime Forfettario) . Nor does it necessarily cover the […]
Tax Step Up of Shares/Land and Buildings – Revaluation
Law Decree no. 17 of March 1, 2022, containing urgent measures for the containment of electricity and natural gas costs, the development of renewable energy and the relaunch of industrial policies, known as the Energy Decree was published in the Official Gazette no. 50 of March 1, 2022. Article 29 of the Decree confirms the […]
Tax on Disposal of Real Estate
General Rule In Italy, capital gains from the disposal (sale or transfer) of real estate are generally treated as miscellaneous income under Article 67 of the TUIR (Testo Unico delle Imposte sui Redditi, DPR 917/1986). The taxable gain is the difference between the sale price and the acquisition cost (plus any additional expenses such as […]
Tax on Capital Gains for Individuals – Disposals of Shareholdings
Background – Taxation of Gains and Losses The disposal of shareholdings (e.g., shares or equity interests in companies) in Italy may trigger a charge to Italian tax on any capital gain under the Italian Tax Code (DPR 917/1986). The tax treatment differs significantly based on the percentage interest in the company and Italian tax residency […]