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
International Taxation
Italy’s Tax Administration Issued Final Guidance on Taxation of Trusts, Singles Out UK “Offhore” Trusts Subject to New Anti Abuse Rule
By Marco Rossi on
On October 20, 2022, Italy’s Tax Administration issued Circular 34/E providing final guidance on the Italian taxation of trusts. One section of the guidance discusses the new anti-abuse rule on the taxation of income distributions from foreign trusts to Italian resident beneficiaries. Article 44, paragraph 1, letter g-sexies of the Italian Income Tax Code…
Italian Tax Administration Issued Its Final Guidance on Taxation of Trusts, Discusses Italian Gift Tax On Distributions From Foreign Trusts
By Marco Rossi on
On October 20, 2022 the Italian Tax Administration issued Circular n. 34/E (Circolare Trust n. 34 del 20 ottobre 2022) providing final guidance on Italian taxation of trusts. One issue addressed in Circular 34 deals with the application of the Italian gift tax with respect to a transfer of property into a foreign…
Disregarded Trust Still Complete For Italian Gift and Estate Tax Purposes, Italian Tax Agency Says
By Marco Rossi on
In its Ruling n. 359 of July 4, 2022 (Risposta n._359 of 04.07.2022), the Italian Tax Agency ruled that a trust which is disregarded for income tax purposes under the standards of Circular n. 61/E of December 27, 2010, is still respected as a complete and effective trust for Italian gift and estate tax…
Italy’ Tax Agency Rules on Interplay Between HNWIs’ Flat Tax and Taxation of Italian Source Employment Income
By Marco Rossi on
With its Resolution n. 83 of 2-14-2022, the Italian Tax Agency ruled on interaction between the Italian special tax regime for high net worth individuals (so called “flat tax” or “lump sum tax” regime) and taxation of Italian source employment income under Italy’s general income tax.
The case involved certain international employees of an…
Discretionary Beneficiary of Irrevocable Trust Required to Disclose Trust on Italian Tax Return
By Marco Rossi on
With its ruling n. 693 of October 8, 2021 (Prassi – AGENZIA DELLE ENTRATE – Risposta 08 ottobre 2021, n. 693), the Italian Tax Agency held that a discretionary beneficiary of a foreign irrevocable trust, treated as a fiscally opaque trust under Italy’s tax classification rules, is required to report his beneficial interest…
Italian Tax Agency Rules on Italy’s Foreign Branch Exemption
By Marco Rossi on
With tax ruling n. 18/2022 of January 12, 2022 (Risposta_18_12.01.2022), the Italian tax agency ruled that for the foreign branch tax exemption to apply, a permanent establishment must exist in the foreign jurisdiction, fully taxable in the host country under both foreign country’s domestic tax law and any applicable tax treaty between Italy…
Foreign Employer’s Italian-Based Remote Worker Eligible For Special Tax Regime, Italy’s Tax Administration Rules
By Marco Rossi on
In a series of recent tax rulings, Italy’s Tax Administration ruled that “remote workers” who live in and work remotely in Italy for a foreign employer with no trade or business in Italy can still qualify for the benefits of Italy’s new-resident workers special tax regime.
In 2015, Italy enacted a special tax regime for…
Italian Tax Administration Rules On Tax Classification and Source Of Income From a CEO Employment Agreement For The Purpose of Italy’s HNWIs Special Tax Regime
By Marco Rossi on
In response to a petition we presented on behalf of the taxpayer, the Italian Revenue Agency issued an advance tax ruling in a case concerning the determination of the tax character and the source (place of production) of taxpayer’s income arising from a contract of services as president and chief executive officer and board member…
No Transfer Taxes Apply To Distribution of Trust Property to Settlor Upon Termination of the Trust, Italy’s Supreme Court Rules
By Marco Rossi on
With its ruling n. 8719 of March 30, 2021(Cass. n. 8719, 30-3-2021) the Italian Supreme Court ruled that no Italian gift tax applies when the trust assets are distributed back to the settlor, upon termination of the trust following the trust beneficiaries’ disclaimer of their beneficial interests under the trust.
The case involved…