On October 9, 2023, the last Ministerial Decree required for the final implementation of Italy’s Register of Trusts was published, and the Register of Trusts is now in effect. The initial filing deadline is December 11, 2023. The filing in the Register is required for domestic trusts, private foundations, and similar legal arrangements, defined as
2023
Italy plans to repeal special tax regime for new resident workers, professional and entrepreneurs from 2024
By Marco Rossi on
On October 16, the Council of Ministers approved a legislative proposal that will repeal the special tax regime for new resident workers, entrepreneurs, and professionals with effect from January 1, 2024.
The special regime, enacted in its final form in 2020, allows Italian and foreign nationals who establish their tax residence in Italy while not…
Is There a Change of Course On Split Tax Residence Year? Italian Tax Agency Rules That Italy-Switzerland Tax Treaty’s Part-Year Tax Resident Provision Prevails Over Domestic Law, Refers to OECD Commentary In Support
By Marco Rossi on
In its ruling n. 370 issued on July 4, 2023, the Italian Tax Agency concluded that in a case of a change of tax residency during the year, the treaty provision according to which the change of tax residence takes effect on the day of the transfer out of Italy to the foreign country is…
Italian Taxation of Trusts: U.S. Complex Trust Meets Italy’s Anti-Abuse Rule, Distributions of Trust Income to Italian Trust Beneficiaries Not Taxable In Italy
By Marco Rossi on
The Italian Tax Agency’s Ruling n. 309 of April 28, 2023 (Risposta-n.-309_2023-1.pdf) deals with the issue of taxation to Italian beneficiaries of income distributions from a U.S. trust.
Background.
Under Italy’s tax law, trusts with identified income beneficiaries are treated as fiscally transparent, and the beneficiaries are taxed on their share of…
Italian Taxation of Trusts: Tax Agency Rules that Settlor’s Unconditioned Power To Remove and Replace Guardian Makes the Trust Fiscally Interposed, Nonexistent For Tax Purposes
By Marco Rossi on
In its ruling no. 267, dated March 27, 2023 (Risposta-n.-267_2023.pdf), the Italian Tax Agency addressed a case involving a trust where the Settlor reserved the power to revoke and replace the Guardian and retained certain powers related to the shares of a company he transferred to the trust, including the power to appoint…
Italian Taxation of Trusts: Tax Agency Rules on Taxation of a Foreign Family Trust and Testamentary Trust in Italy
By Marco Rossi on
The Italian Tax Agency recently issued a ruling (n. 251 of March 16, 2023) that provides guidance on the Italian tax classification of Family Trusts and Testamentary Trusts and the taxation of Italian beneficiaries on the trusts’ income.
Background
The settlor, an Australian national, established the trusts while he was a resident of…
Italian Taxation of Trusts: Tax Agency Rules on Taxation of Beneficiaries of Unitrust Distributions
By Marco Rossi on
The Italian Tax Agency recently issued Ruling n. 237 of March 2, 2023 (Risposta-n.-237_2023.pdf), which clarifies foreign trusts’ tax treatment concerning Italian tax resident beneficiaries.
Under the ruling, when the trustee of a foreign trust is required to make an annual distribution to beneficiaries based on a predetermined percentage of the fair market…
Italian Taxation of Trusts: Tax Agency Rules on Taxation of “Unitrust” Beneficiaries
By Marco Rossi on
With its Ruling n. 237 of March 2, 2023 (Risposta n. 237-2023), the Italian Tax Agency ruled that when the trustee of a foreign trust is required to make an annual distribution to the beneficiaries of the trust of cash or other property of the trust that represent a predetermined percentage of the…
Italy’s New Guidance on International Tax Reporting for Trust Beneficiaries
By Marco Rossi on
The Italian tax administration, in its Circular n. 34 of October 20, 2022, provided some new guidance on the international tax reporting obligations for assets held in foreign trusts. Domestic trusts report foreign assets held under the name of the trust on their own income tax return. In the case of foreign trusts, the reporting…
Some further thoughts on the Italian Supreme Court’s dividend foreign tax credit ruling: very good news for taxpayers, or a potential misunderstanding?
By Marco Rossi on
On September 1, 2022, the Italian Supreme Court issued a ruling (n. 25698) in a case concerning a distribution from a U.S. partnership treated as a taxable dividend in Italy. The dividend was taxed by way of a substituted tax, and Italian tax law did not allow a credit for the income tax paid the…