Enactment of the fiscal decree

Subject: Conversion into law of the fiscal decree containing “urgent provisions on tax matters and for unavoidable needs” (Decree-Law No. 124/2019)

Following the conversion into law of the decree containing “urgent provisions on tax matters and for unavoidable needs” (Decree-Law No. 124/2019), the following are the main changes of particular interest to employers and withholding agents, as approved or amended during the conversion process.

In addition, the document also includes clarifications on “withholdings and offsets in contracts and subcontracts” provided by the Italian Revenue Agency.

Offset of tax credits accrued since 2019

It has been confirmed that VAT credits (annual/quarterly), IRPEF credits, IRES credits, and IRAP credits—where the amounts exceed €5,000.00 per year—may be offset starting on the tenth day following the date of filing the annual return or the application showing the credit.

Under the new provisions, the 2019 IRPEF/IRES/IRAP tax credit may therefore be offset following the filing of the relevant tax return and no longer as of January 1, 2019. Therefore, if the tax return is filed on September 30, 2020 (tax year 2019) and shows a credit exceeding €5,000.00, said credit will be available starting October 10, 2020 exclusively through payment of FormF24 via the Entratel/Fisconline electronic services.

In order to offset credits related to direct and substitute taxes, as well as the IRAP credit, on Form F24, the following conditions must be met as of January 1, 2020:

A) a prior submission of the tax return showing the tax liability for the following categories: substitute taxes, income taxes and surcharges, IRAP, and VAT;

B) the submission of Form F24 via the Revenue Agency’s online services, for credits related to: substitute taxes, income and surtaxes, IRAP, VAT, tax breaks, and credits indicated in the RU section of the tax return.

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