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,
Taxation of Trusts
Italian Tax Administration Issued Its Final Guidance on Taxation of Trusts, Discusses Italian Gift Tax On Distributions From Foreign Trusts
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
In its Ruling n. 359 of July 4, 2022 (Risposta_351_18.05.2021-2) 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 purposes. As…
Discretionary Beneficiary of Irrevocable Trust Required to Disclose Trust on Italian Tax Return
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…
No Transfer Taxes Apply To Distribution of Trust Property to Settlor Upon Termination of the Trust, Italy’s Supreme Court Rules
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…