Tax Return Filing Season 2024

DOCUMENTS REQUIRED FOR FILING THE ITALIAN TAX RETURN for YEAR 2023

Clients have to present:

> Copy of a valid identification document (identity card/passport) and Italian tax identification code (codice fiscale)

> Any certificate regarding the variation of residence address or civil status

> Copy of the Tax Identification Number for each dependent family member: please note that a family member can be deemed as dependent if he/she received a gross annual income not higher than 2.840,51 EUR during 2022, or not higher than 4.000,00 EUR for children aged up to 24 years

> Copy of CU2024 form issued by the Italian employer

> Properties and land owned in Italy during 2023:
Summary of property and land situations related to year 2023;
In case of purchase, sale, inheritance, donation of real estate etc. please provide a copy of the purchase deed, sale agreement, donation act or inheritance declaration;
In case of properties rented out, please provide a copy of the rental agreement and registration receipt released by the tax office

> Any other worldwide income received during 2023
In case of foreign employment income, please provide a copy of the payslips and annual statement released by the foreign employer;
In case of rental income derived from foreign properties please provide a copy of the foreign tax return and rent agreement;
if you have filed a 2023 tax return in a foreign country please provide a copy, along with the receipt of payment of foreign income taxes if any.

> Deductible expenses paid during 2023 (please refer to list “MAIN TAX-DEDUCTIBLE EXPENSES” below)

> Properties held abroad during 2023:
– Copy of the purchasing contract, sale agreement, inheritance declaration, donation act etc.;
– Copy of your 2023 tax return filed in the foreign country (if any);
– Copy of the property tax notice issued by the foreign tax authority;
– Copy of the receipt of payment of the foreign property tax;
– For properties situated in EU countries, please provide copy of the document attesting the fiscal value determined by the foreign tax authority for the calculation of the foreign property tax.

> Current accounts and savings held abroad during 2023: for each bank account, please provide copy of the bank statements covering the whole period 01/01/2023 – 31/12/2023 (including interests paid throughout 2023, if any)

> Other financial activities held abroad during 2023 (e.g. shares, bonds, securities, foreign currencies, financial contracts, investment funds, life and capitalization insurances, private pension plans, derivatives, precious metals, other financial instruments, participations to trust foundations and other legal entities etc.). For each financial activity, please provide:
– Copy of the statement proving the opening value on 01/01/2023;
– Copy of the statement proving the closing value on 31/12/2023;
– Copy of the statement certifying any income paid during 2023 (e.g. interests, dividends, capital gains etc.);
> Other patrimonial assets held abroad during 2023: (e.g. registered movable properties as boats or luxury cars, works of art and jewellery, precious metals, others). For each asset please provide:
– document attesting the value on 01/01/2023;
– document attesting the value on 31/12/2023;
– document attesting any income paid during 2023;

MAIN TAX-DEDUCTIBLE EXPENSES

It is required to provide proof of payment made through electronic means (e.g. wire transfer, credit card etc.)

Percentage of deduction from taxes =19%

>HEALTH CARE EXPENSES: taxpayers may deduct health costs for medical and dentist services, clinical analysis, surgery costs, specialist’s fees, hospital stay, prosthesis purchase (you will need to provide copy of the medical prescription or self-certification) and medicines purchase (both homeopathic than allopathic). Please take note that tickets must show your fiscal code. Please provide any medical invoice and receipt. Receipts related to the purchase of medicines not requiring medical prescription should be stapled on an A4 size paper sheet. Note: health expenses can be deducted only in case their total amount exceeds € 129,11. Health care expenses that exceed the limit of €15.493,71 can be divided into four annual quotas and included in the following tax declarations.
>HEALTH EXPENSES FOR SPECIALIST MEDICAL ASSISTANCE: personal assistance to non-self-sufficient persons, e.g. nursing expenses, expenses related to rehabilitating therapies, any expense due to assistance services from qualified health operators. Health expenses for specialist medical assistance can be deducted up to a maximum of €2.100 in case the gross total income does not exceed €40.000.
>HEALTH EXPENSES RELATED TO SPECIFIC PATHOLOGIES FOR WHICH TICKET PAYMENT IS NOT REQUIRED even if paid for non dependent family members. These expenses can be deducted only in case their total amount exceeds the threshold of € 129,11.
>HEALTH EXPENSES PAID FOR DISABLED PERSONS. The 19% detraction is granted on the entire value of these expenses, without any threshold. A detraction is also allowed for the purchase of one vehicle for disabled persons every four years up to a maximum expense of € 18.075,99. Blind persons can claim a detraction for the purchase of one guide dog every four years. Deaf persons can claim a detraction for interpreting services.

>VETERINARY EXPENSES up to a maximum amount of € 550 and only for the part exceeding the threshold of € 129,11. Please provide invoices and tickets for veterinary medicines (these must show your fiscal code).

>PASSIVE INTERESTS ON MORTGAGE LOANS AIMED AT PURCHASING/BUILDING A PROPERTY USED AS PRINCIPAL ABODE: please provide the annual statement issued by your bank listing the amount of interests and related burdens paid during 2023. For new mortgage loans taken in 2023 please provide copy of the real estate purchase contract, copy of your residence certificate and copy of the loan agreement. Taxpayers are allowed to deduct notary expenses paid for drawing up the loan contract, so please provide also the notary’s invoices. The detraction is calculated on a maximum amount of € 4.000 per year in case of purchasing and of € 2.582,28 per year in case of building.

>PASSIVE INTERESTS ON LOANS taken in 1997 for buildings maintenance, restoration and renovation. The detraction is calculated on a maximum amount of € 2.582,28 per year.

>LEASE EXPENSES FOR PRINCIPAL HOUSE: detraction for leasing fees related to contracts stipulated between January 2016 and December 2020 for real estate properties to be utilized as main dwelling, in case the gross total income does not exceed €55.000.

>LIFE OR ACCIDENT INSURANCE PREMIUM: for insurances stipulated after year 2000 only the premium covering the risk of death and permanent disability higher than 5% is considered deductible. The detraction is calculated on a maximum amount paid of € 530 per year.
>EXPENSES INCURRED FOR PERSONAL CARE WORKERS in cases of non-self-sufficiency in the performance of the acts of daily life. The taxpayer can benefit from the deduction, up to a maximum amount of 2,100 euros, only if the total income does not exceed 40,000 euro. The limit of 2,100 euros refers to the individual taxpayer regardless of the number of people to whom the assistance refers.
>EXPENSES INCURRED FOR THE ANNUAL SUBSCRIPTION OF CHILDREN AGED BETWEEN 5 AND 18 TO CONSERVATORIES OF MUSIC, INSTITUTIONS OF HIGHER ARTISTIC, MUSICAL AND CHOREUTIC TRAINING: the taxpayer can benefit from the deduction, up to an amount not exceeding 1,000 euros for each child, only if the total income does not exceed 36,000 euros.
>INSURANCE PREMIUM FOR PERSONS WITH SEVERE DISABILITY: the detraction is calculated on a maximum amount paid of € 750 per year.

>INSURANCE PREMIUM AGAINST RISK OF NON-SELF-SUFFICIENCY IN CARRYING OUT DAILY ACTS OF LIFE: the detraction is calculated on a maximum amount paid of € 1.291,14 per year.

>EDUCATION EXPENSES for PRIMARY and SECONDARY SCHOOL PERTAINING TO THE NATIONAL SCHOOL SYSTEM up to a maximum amount paid of € 800,00 for each child (school canteen fees included).

>EDUCATION EXPENSES for UNIVERSITY. For public universities situated in Italy no maximum limit applies. Fees for private or foreign universities are deductible only up to the limit established annually for each university by decree of the Ministry of Education basing on the average amounts of taxes and contributions due to state universities.

>FUNERAL EXPENSES up to a maximum amount paid of € 1.550,00.

>FEES FOR SUBSCRIPTIONS TO PUBLIC TRANSPORT SERVICES up to a maximum amount paid of € 250,00 (also for dependents).

>INSURANCE AGAINST CALAMITOUS EVENTS for residential properties;

>MEDICAL EXPENSES FOR SPECIFIC LEARNING DISORDERS (socalled “DSA”) until completion of the secondary school;

>KINDERGARTEN EXPENSES up to a maximum amount paid of € 632,00 for each child.

>MUTUAL ASSISTANCE ASSOCIATIONS: membership fees paid to mutual assistance associations up to a maximum expense of €1.300. Payment must be made through credit or debit card, check, postal or bank transfer;

>SPORT ACTIVITIES FOR KIDS: for kids aged from 5 to 18 years old you have the possibility to claim a tax credit equal to the 19% of the amount paid for their participation to amateurish sport activities, up to a maximum amount paid of € 210,00 for each kid.

>REAL ESTATE AGENCY FEE PAID FOR PURCHASING THE PROPERTY TO BE USED AS PRINCIPAL ABODE: fee paid to real estate agencies for the purchase of a living unit used as principal abode up to a maximum expense amount of € 1.000,00.

>HOUSE RENT PAID BY STUDENTS attending university in a municipality at least 100 Km away from the municipality of residence and situated in a different province or other EU/EEA State. The detraction is calculated on a maximum expense amount of € 2.633 per year.

>FREE DONATIONS to welfare and charitable organizations for populations affected by public disasters or extraordinary events (maximum amount € 2.065,83), schools of all levels, amateur sport organizations (maximum amount € 1.500), “La Biennale di Venezia” (up to maximum 30% of the gross income), cultural and artistic organizations, entities operating in the show business (up to maximum 2% of the gross income), entities operating in the music business (up to a maximum 2% of the gross income or up to 30% under certain conditions), amortization fund for government securities. Payments must generally be made through debit or credit card, check, postal or bank transfer.

>SOCIAL SECURITY CONTRIBUTIONS PAID FOR DEPENDENTS who have not yet started any work activity and would like to pay contributions for the period of university education.

Percentage of deduction from taxes = 26%

>FREE DONATIONS to non-profit organizations (Onlus) and political parties up to a maximum of €30.000, if paid through credit or debit card, check, postal or bank wire transfer.

Percentage of deduction from taxes =30-35%

>DONATIONS TO CHARITABLE ORGANIZATIONS: tax credit equal to 30% of the donations (in cash or in kind) made to ONLUS and APS (social promotion associations) up to a maximum of €30.000; the tax credit increases to 35% for donations to ODV (voluntary organizations) up to a maximum of €30.000. Donations in cash must be made through credit or debit card, check, postal or bank wire transfer.

>DONATIONS TO ORGANISATIONS FIGHTING AGAINST COVID-19 PANDEMIC: a tax credit equal to 30% of the donations (in cash or in kind) made to organisations that have tried to contain and manage the COVID-19 emergency up to a maximum of €30.000. Donations in cash must be made through credit or debit card, check, postal or bank wire transfer.

Percentage of deduction from taxes = 36-50%

>REFURBISHMENT WORKS ON PROPERTIES OR PURCHASE OF A GARAGE under article 16-bis of the Italian Income Tax Code “TUIR”. In particular, the tax allowance covers expenses incurred in order to perform extraordinary maintenance interventions, refurbishment and restructuring works for single apartments and buildings, building of a garage or car parking place, intervention to lower the risk of robbery or criminal acts (e.g. alarms, bars at the windows etc.), anti-seismic interventions made on properties situated in Italy.

The deduction is also applicable to expenses incurred for interventions aimed at achieving energy savings, including the installation of systems based on the use of renewable energy sources, including photovoltaic systems for the production of electricity.

Ordinary maintenance interventions qualify for the tax relief only if they concern the common areas of residential buildings. The detraction may be claimed also by tenants who bear the renovation costs (e.g. for air conditioning, alarm systems, bars on the windows etc.).

Deduction of 36% for expenses paid until 25th June 2012 (up to a maximum amount paid of € 48.000)

Deduction of 50% for expenses paid from 26th June 2012 until 31st December 2022 (up to a maximum amount paid of € 96.000).

For expenses paid through the condominium you will have to provide the certification letter released by the condominium administrator only;

For expenses paid on your own you will have to provide copy of the following documents:

– invoices paid;
– copy of the wire transfer receipts made in accordance with Art. 16-bis of TUIR;
– cadastral references of the property if the owner is claiming the tax relief, or rent agreement if the tenant is claiming the tax relief;
– any mandatory notification submitted to the municipal authorities required to authorize the works (if due);
– builder’s statement indicating the construction cost of the garage (in case of purchase of a garage);
– starting from 21st November 2018, for some type of renovation works a communication to ENEA (Italian National Institution for new technologies, energy and sustainable economic development) is also required.

For works performed before 2022 and therefore already included in prior tax returns we require copy of the last tax return and copy of the connected documentation, if not already in our hands.

N.B.: the rebate will be divided into 10 yearly instalments.

>EXPENSES FOR THE FURNISHING OF REFURBISHED BULDINGS e.g. purchase of furniture and white goods with energy class not lower than A+ or A for ovens (e.g. the major home appliances are included: refrigerators, freezers, washing machines, dryers, dishwashers, cooking appliances, electric heaters, microwave ovens, electric heating, electric radiators, electric fans etc. – costs of transportation and installation of the goods are included).

The deduction is strictly connected to the above-mentioned deduction for refurbishment works on properties situated in Italy, and for expenses borne in 2022 it may be claimed only if the renovation works have started from the 1^st of January 2021 or later and in any case before the purchase of the furniture/white goods.

The deduction is calculated on a maximum amount of € 10.000.

For obtaining the rebate please provide copy of the following documents:

– invoices paid;
– payment receipts (copy of the wire transfers performed in accordance to the law or receipt of payment made with electronic cards);
– energy class documentation for white goods.

N.B.: the rebate will be divided into 10 yearly instalments.

>GREEN BONUS: Deduction of 36% expenses incurred for the renovation of green areas connected to real estate units and jointly-owned buildings up to a maximum of € 5.000.

N.B.: the rebate will be divided into 10 yearly instalments.

Percentage of deduction from taxes =50-85%

>ENERGY SAVING MODIFICATIONS under Law Decree 63/2013: e.g. the purchase of photovoltaic solar panels for heating, replacement of frames, thermal coating on existing buildings, boilers replacement, air conditioning system that meets special energy saving requirements.

– Detraction of 55% for expenses paid until 5th June 2013
– Detraction of 65% for expenses paid from 6th June 2013 until 31st December 2019
– Detraction of 70-75% for expenses on shared buildings
– Detraction of 80-85% for expenses on shared buildings for lowering sismic risk
– Detraction of 50% for other expenses

For obtaining the rebate the taxpayer has to provide copy of the following documents:

– invoices paid;
– payment receipts (copy of the wire transfers performed in accordance to the law);
– copy of the notification to the ENEA (Italian National Institution for new technologies, energy and sustainable economic development);
– assertion of a certified technician, if necessary, along with the energy saving certification.

N.B.: the rebate will be divided into 10 yearly instalments.

Percentage of deduction from taxes =90-110%

>FACADE BONUS: from 1 January 2020 a deduction of 90% has been provided for expenses on interventions aimed at the recovery or restoration of the external facade of existing buildings. The detraction will be divided in 10 years.

>SUPERBONUS: starting from 1 July 2020 a deduction equal to 110% is granted for expenses connected to specific interventions.

Other deductions

>TENANT ALLOWANCE FOR EMPLOYEES WHO MOVED THEIR RESIDENCE FOR BUSINESS REASONS in the last three years and that are at least 100 km far from the previous residence territory (applicable only if the gross annual income is not higher than 30.987,41);

>TENANT ALLOWANCE : in case of rent contract under Law 431/98 stipulated for renting a property used as main house (applicable only if the gross annual income is not higher than 30.987,41);

>TENANT ALLOWANCE FOR YOUNG INDIVIDUALS: in case of rent contract under Law 431/98 stipulated by tenants aged between 20-30 years old for renting a property used as main house (applicable for maximum 3 years and only if the gross annual income is not higher than 15.493,71);

>INVESTMENTS IN INNOVATIVE START-UP: deduction from taxes equal to 30% (40% in 2019) of the investment up to a maximum investment limit of € 1.000.000.

>HOLIDAY TAX CREDIT: deduction from taxes equal to 20% of the expenses incurred for holidays within the limit attributed to the family.

Deductions from income

>MANDATORY AND VOLUNTARY SOCIAL SECURITY CONTRIBUTIONS (even if paid for dependent family members): contributions paid to the national social security authority and mandatory pension funds (including voluntary contributions paid for the period of university education and housewife’s INAIL insurance).

>PERIODIC ALIMONY PAID TO THE EX-SPOUSE: please provide copy of the separation agreement validated by the Court showing the amount to be paid periodically and copy of the payments made during 2022 (the amount paid for child support is excluded).

>SOCIAL SECURITY CONTRIBUTIONS PAID FOR DOMESTIC AIDES: security contributions paid by the employer for domestic aides are deductible up to a maximum amount of € 1.549,37.

>DONATIONS TO RELIGIOUS INSTITUTIONS up to a maximum amount of € 1.032,91. Payments must generally be made through credit or debit card, check, postal or bank transfer.

>CONTRIBUTIONS TO SUPPLEMENTARY FUNDS TO THE NATIONAL HEALTH SYSTEM: up to a maximum of € 3.615,20 per year;

>DONATIONS TO ONG ORGANIZATIONS OPERATING FOR THE DEVELOPING COUNTRIES: only for donations to duly recognized non-governmental organizations, up to maximum 2% of the gross income.

>DONATIONS TO CERTIFIED NON-PROFIT ORGANIZATIONS in the limit of 10% of the annual total income of the taxpayer and in any case for an amount not higher than € 70.000.

>MEDICAL EXPENSES AND SPECIFIC ASSISTANCE FOR DISABLED PERSONS from qualified medical and paramedical staff. Medical expenses for family members entrusted to institutional care structures are included.

>DONATIONS TO UNIVERSITIES AND PUBLIC RESEARCH BODIES, REGIONAL OR NATIONAL PARKS.

>DONATIONS TO TRUST AND SPECIAL FUNDS. up to a maximum of 20% of the gross income and in any case not exceeding € 100.000.

>DONATIONS TO ORGANIZATIONS certified as “ONLUS”, “ODV”, “APS” up to a maximum of 10% of the gross income, the amount exceeding that limit will be carried forward to the next tax returns (for a maximum of four years).

>PURCHASING/BUILDING EXPENSES FOR PROPERTIES TO BE RENTED OUT: deduction equal to 20% of the purchasing price or construction costs up to a maximum of €300.000 for properties leased out within 6 months and with a rent agreement lasting at least 8 years (purchasing/building period: from 1 January 2014 to 31 December 2017).

>OTHER DEDUCTIBLE BURDENS:

– Annual taxes paid to land reclamation authority;
– Compensation paid by the landlord for the non-renewal of the contract in case of real estate rented for business purposes;
– Incomes already subjected to taxation in previous years’ tax returns which however had to be returned during 2023;
– Employment incomes taxed even if they shouldn’t have been included in the taxable income by the employer;
– 50% of the amount paid for adoption procedures accomplished for adopting foreign children;
– Premiums paid to private pension plans.

>COMPLEMENTARY AND INDIVIDUALS PENSION SCHEMES: ordinary limit € 5.164,57 per year (increased in case of special pension schemes)

Foreign Investments Monitoring (Law Decree 167/1990) applicable to Italian residents who holds assets outside of Italy

Italian tax residents have the obligation to file the RW form to report any foreign investment and financial asset held abroad during year 2023.

The definition of investment and financial asset is rather wide and includes any investment or disinvestment which might potentially produce income. In case of joint properties/assets, the whole value and the percentage of ownership has to be indicated. Those who have the possibility of using/managing the asset and the beneficial owners of the property/asset have also the obligation to file the RW form (e.g. delegated users for bank accounts, beneficiary of trust arrangements etc.). The Italian government introduced a wealth tax on foreign real estate and financial assets held abroad for tax resident individuals, which took effect in 2012. We remind you that an individual is considered tax resident if he has been living in Italy for at least 183 days during the year.

IVAFE (wealth tax on foreign financial assets):

– Current accounts: €34,20 for each account (prorated basing on holding period and percentage of ownership). No IVAFE is due if the annual average balance considering all current accounts held at the same bank was lower than €5.000. However, when the maximum amount reached during the year exceeds €15.000 the current account must be reported on the tax return;
– Any other financial activity: 0,2% tax rate applied on the closing balance at 31/12 (prorated basing on holding period and percentage of ownership)
– The wealth tax paid in the foreign country can be deducted

IVIE (wealth tax on foreign properties):

– Tax rate: 0,76% applied (if principal abode 0,4% less € 200 standard deduction less € 50 deduction for each child aged less than 26 and residing in the house)
– taxable base: cadastral value or fiscal value determined by the foreign authority for properties situated in EU-EEA countries, purchase price or market value for properties situated in non-EU-EEA countries.
– The property tax paid in the foreign country can be deducted

Special tax regime for inpatriate workers (Law Decree 147/2015)

The latest version of the Italian special tax regime for inpatriates provides a reduction of the taxable base for employment, self-employment and/or business income produced in Italy ranging from 70% to 90% for individuals who transferred their residence to Italy starting from 30/04/2019. The initial duration of the regime is 5 years, and under certain circumstances can be extended until maximum 10 years in total.

The individual will be eligible for the tax relief if he/she:

– transfers his/her residence to Italy in order to start a new employment/self-employment/business activity;
– qualified as non-tax resident of Italy for the 2 tax years prior to arrival to his/her arrival Italy;
– commits to maintain his/her tax residence in Italy for at least 2 tax years following his/her arrival;

Specific requirements for inpatriate workers under art. 16 par. 1 of D.Lgs n. 147/2015:

– perform the work activity mainly on Italian territory during each tax year concerned by the tax relief (at least 183 days or 184 days for leap years).

Specific requirements for inpatriate graduated workers under art. 16 par. 2 of D.Lgs n. 147/2015:

– being EU citizen or citizen of a non-EU Country having a tax treaty for the avoidance of double taxation or an agreement for the exchange of information in place with Italy;
– having a university degree (bachelor or master with an ordinary duration of minimum 3 academic years);
– having continously carried out an employment / self-employment / business activity outside of Italy during the last 24 months prior to arrival, or alternatively having studied and obtained a university degree outside of Italy during the last 24 months prior to arrival.

FOR THE INITIAL 5-YEAR PERIOD: The taxable income is reduced to 30%. If the individual transfers his/her residence to the Southern Regions (Abruzzo, Molise, Campania, Puglia, Basilicata, Calabria, Sardinia, Sicily) the taxable income is reduced to 10%.

IN CASE OF EXTENSION FOR AN ADDITIONAL 5-YEAR PERIOD: the tax relief may be extended for an additional 5-year period, with a taxable income reduced to 50%, if any of the following conditions applies:

– Individual has at least one dependent or underage child (also in pre-adoptive foster care); or
– Individual buys a residential property in Italy after the arrival to Italy or during the 12 months preceding the arrival to Italy.

For workers having at least 3 dependent or underage children (also in pre-adoptive foster care), the taxable income during the additional 5-year period, will be reduced to 10%.

NB: in case of individuals who have transferred their tax residence to Italy before 30 April 2019, it is necessary to verify the requirements provided under the previous versions of the regime.