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
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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…
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
In its Ruling n. 309 of April 28, 2023 (Risposta-n.-309_2023-1.pdf) the Italian Tax Agency addresses the issue of taxation to Italian beneficiaries with respect to distributions from a U.S. Trust.
Background
Under Italy’s tax law, trusts are classified in one of three ways, with different tax consequences for the trust, the settlor, and…
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
With its ruling n. 251, issued on March 16, 2023 (n. 251 of March 16, 2023), the Italian tax agency addressed the issue of the tax classification of a Family Trust and a Testamentary Trust that were funded and started operating following the death of the settlor.
Background
Under Italy’s tax law, trusts are classified…
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…
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…
Italy’s Substituted Tax Regime Applies in Case of Partly Italian-Source, Partly Foreign-Source Income
By Marco Rossi on
In its Ruling n.83 of February 14, 2022, the Italian Tax Agency confirmed that Italy’s substituted tax regime (so-called flat tax, or forfeit) for high net worth individuals applies in a case in which international executives or managers of multinational companies perform their functions partly in Italy and partly outside of Italy, where the group’s…
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…