Tax and social security payments suspended
With the “Cure Italy” decree-law and the subsequent “Liquidity Decree”, the Italian Government has suspended a wide range of withholding taxes, taxes and contributions. Deadlines have been postponed and tax and social security contributions have been suspended (for all small businesses and with no turnover limits for businesses operating in the most affected sectors); collection procedures and payment demands have also been postponed; inspection notices and payments due for various procedures to correct tax positions have been deferred. In addition, the decree provides for a tax credit for lessees running businesses, renouncing part of the rent for the month of March. Also with regard to taxes, the range of deductions has been extended to provide an incentive for the private sector to finance measures to combat the epidemic and provide health care.
- Suspension of taxes, with no turnover limits, for the most affected sectors - Payments of contributions and withholding taxes for employees will be suspended in March and April for operators in the sectors most affected by the crisis. A one-off payment can be made by 31st May 2020, or the amounts due can be paid in up to 5 equal monthly instalments, starting from the month of May 2020. The sectors concerned are: tourism-hotels, spas, passenger transport, bars and restaurants, culture (cinemas, theatres), sports, education, amusement parks, events (fairs/conventions), amusement arcades and betting shops.
- Suspension of VAT payments in April and May - for taxpayers in the 5 most affected provinces (Bergamo, Brescia, Cremona, Lodi and Piacenza), on the sole condition that they suffered a decrease in turnover or fees of at least 33% in March 2020 compared with the same month of the previous tax year and in April 2020 compared with the same month of the previous tax year. A one-off payment for the amounts due can be made by 30th June 2020, or the amounts due can be paid in up to 5 equal monthly instalments starting from June 2020, without any sanctions or interest being applied.
- Payment deadline deferral - For economic operators who cannot benefit from the suspension, the deadline for payments due on 20th March shall nonetheless be considered duly made if completed by 16th April 2020, without any sanctions or interest being applied.
Payment postponed for the licence fees and taxes applicable to betting shops: deadline postponed from 30th April to 29th May 2020.
- Non-application of withholding tax for professionals with revenues or fees not exceeding € 400,000 received in the period between 17th March 2020 and 31st May 2020. The withholding tax amount is due by July 2020 as a one-off payment, or as 5 equal monthly instalments starting from July 2020.
- Sanitisation: a 50% tax credit has been introduced for costs incurred for sanitising workplaces, with a cap on this benefit at € 20 thousand. A similar tax credit has also been introduced for expenses relating to the purchase of personal protective equipment (such as surgical masks, Ffp2 and Ffp3 masks, gloves, protective visors and protective glasses, protective suits and shoes), or the purchase and installation of other safety devices designed to protect workers from accidental exposure to biological agents or to ensure safety distances are maintained between people (such as barriers and protective panels). Hand cleansers and disinfectants are also included.
- Bonus for workers: an extra €100 will be paid to workers who carried out their jobs in their places of work in March (as opposed to smart working), in proportion to the days worked. Workers with an income of up to € 40 thousand are eligible. This will be paid to all employees as long as they were present and performed their work on all days required by their contracts, regardless of whether this be on a full-time or part-time basis. The bonus will not be paid for days when workers did not carry out their job at their workplace because they were working from home or via smart working, or if they were absent for any other reason.
- Suspension of deadlines for the Italian Revenue Agency's collection, liquidation and inspection activities;
- COVID-19 donations: the donations made by companies that can be deducted have been extended to those to support measures to combat the epidemiological emergency. In parallel, a 30% deduction can be made for donations made by natural persons, with a limit of € 30 thousand on this benefit. Donations made by natural persons, by non-commercial entities and by subjects receiving business income concerning food solidarity measures in the context of the Covid-19 emergency and made in favour of the Italian government, regional authorities, local authorities, public bodies or institutions, foundations and legally recognised non-profit associations, are also classed as donations that can benefit from tax incentives. The Civil Protection service is authorised to open dedicated current accounts to collect donations for the Covid-19 emergency.
- Commercial rents: a tax credit equal to 60% of rent amounts for the month of March has been introduced for tenants of properties used as shops and ateliers. The tax credit does not apply to pharmacies, parapharmacies or shops selling basic necessities and can only be used to compensate tax and social security contributions to be made through the F24 form (VAT, IRES, contributions, etc.).
- Telematic tax collection: to facilitate the digitisation also of judicial documents that were initially disputed by the parties in paper format, the tax authorities, collection agents and parties assisted by a qualified lawyer, who have appeared in court following analogue procedures, are required to serve and file subsequent documents, as well as the relative judgements, exclusively by electronic means.
- The deadline for withholding agents to send the “single certification” has been postponed from 31st March until 30th April.
- On 31st March 2020 was the deadline for third parties (including banks, insurance companies, social security institutions and apartment block managers) to send the data required for the pre-filled tax return forms.
- The date when pre-filled tax return forms will be available to taxpayers on the Italian Revenue Agency’s portal has been postponed until 5th May 2020.
- The deadline for sending the pre-filled “730” form has been moved from 23rd July to 30th September 2020.
- Distribution of dividends to partnerships: the rules on profits distributed to partnerships have been modified, including such dividends within the scope of application of regulations on profits from foreign sources, with the exception of those coming from countries or territories with privileged tax regimes, clarifying the methods of application of the withholding tax and substitute tax on the portion attributable to natural persons who are shareholders of the same company, governing the tax regime of profits received by the partnership for the portion attributable to members of non-commercial entities and non-resident shareholders of the partnership and introducing a transitional regime for profits produced up until the financial year as of 31 December 2019, the distribution of which shall be approved by 31st December 2022, applying in this case the tax regime in force before the changes made by the budget law for 2018, which had equated the tax treatment of dividends received by natural persons in possession of qualified and non-qualified holdings, generally imposing the withholding tax of 26%.
- Free sale of medicine for compassionate use: the tax effects generated by the sale of medicines shall be cancelled as part of "compassionate use” schemes (still being tested), treating such medicines, for VAT purposes, as if they had been destroyed and excluding their normal value from contributing to revenues for direct tax purposes.
- Simplifications for the payment of stamp duty on electronic invoices: if the amount of tax due for electronic invoices issued in the first calendar quarter of the year is less than € 250 (but the total amount of tax due for the first and second quarters is greater than € 250), the relative payment may be made by the deadline for the payment of the tax relating to invoices issued in the second quarter of the year. If, also considering the tax due for invoices issued in the second quarter of the year, the total amount to be paid remains below € 250, the payment of the tax relating to the first and second quarters of the year may be made by the deadline for the payment of the tax due in relation to the electronic invoices issued in the third quarter of the year of reference.
- Extension of the tax payment certificates (“DURF”) issued in February2020: Tax payment certificates issued before 29th February 2020 shall remain valid until 30th June 2020. This extension concerns certificates that allow companies and customers not to apply the control mechanism on withholding taxes established by Italian Decree Law no. 124/2019.
- “Main dwelling” benefit deadlines extended: the deadlines regarding the “main dwelling” benefit shall be suspended between 23rd February 2020 and 31st December 2020, to make sure this benefit is not forfeited. In particular, this suspension concerns the 18-month period from the purchase of the main dwelling, within which time the taxpayer must transfer his/her residence to the municipality where the home is located; the one-year deadline for the taxpayer who sold the property purchased using the “main dwelling” benefit to purchase another property to be used as their main home; the one-year deadline for the taxpayer who has purchased a property to be used as a main home to sell the home still in his/her possession.
- Remote tax assistance: for this year's tax assistance services, taxpayers can electronically send authorised tax advice centres (“CAFs”) and authorised professionals a scanned copy (image) of the proxy to access the signed pre-filled tax return form and a copy of the necessary documentation, together with a copy of their identity document. If necessary, instead of signing the proxy, taxpayers can provide the CAF or qualified professional with a specific authorisation using electronic means that can prove their origin.