Article 2 of the Legislative Decree n. 147 of 14 September 2015 (known as the Internationalisation Decree) introduces a new type of advance tax ruling, by which the investors (both resident and non-resident in Italy), intending to realize long-lasting and relevant investments within the Italian territory, can obtain the preventive opinion from the Italian Revenue Agency about the tax treatment applicable to business plans and related extraordinary operations. The advance ruling request can also include the assessment of the existence of a permanent establishment in Italy both for the purposes of direct taxes and VAT.
The request is presented to the Agenzia delle Entrate – Direzione Centrale Normativa – Ufficio Interpelli Nuovi Investimenti (Italian Revenue Agency ̶ Central Directorate for Tax Legislation - Office for Rulings on New Investments) or, for investors who have had access to the regime of cooperative compliance, to the Direzione Centrale Accertamento (Central Directorate for Tax Assessment).
The advance tax ruling on new investments can be submitted also by non-resident companies and institutions of all kinds, as well as trusts, regardless of whether or not they have a permanent establishment in the Italian territory.
Also company groups and groupings of enterprises are entitled to present the application, if they intend to realize a joined investment.
The investment project must necessarily present the following characteristics:
1) it must be realized within the Italian State;
2) it must have a significant and long-lasting impact on employment levels;
3) it must be worth at least 30 million euros.
Definition of investment
The definition of investment includes either projects involving the realisation of a new economic initiative, having a lasting nature (such as those involving the introduction of new liquidity), and all operations involving the re-use of already available undertaking’s financial resources, aimed at restructuring, optimizing and streamlining an existing business. As indicated under n. 1), the investment must have as its target a company located in the State and may also entail share deal transactions.
Effectiveness of the reply
The reply to the application (express or inferred under the tacit consent) shall be given within 120 days of receipt and it is binding on the Italian Revenue Agency with respect to the investment plan as described by the applicant, and it shall be valid until the conditions of law and fact on the basis of which it was given remain unchanged: the Italian Revenue Agency cannot amend the reply to the application for advance ruling on the new investments.
The reply produces its legal effects with respect of the applicant and the other entities on behalf of which the applicant has queried the Italian Revenue Agency for the specific business plan.
Authorities responsible for carrying out assessment activities and investigations on the enterprises involved in the investment plan and with respect to which the reply produces its legal effects, shall be required to co-ordinate with the Office that provided the reply before issuing any formal notice of assessment or other acts with tax content or penalties. This obligation of coordination has the purpose to assess, during discussions with the Office that provided the reply (including cases in which the reply is inferred on tacit consent), whether the possible remark concerns cases already treated in the advance ruling on new investments.
For further information see the following documents: