New measures effective from July 1, 2020
- Studio Piceci
- July 1, 2020
- Reading time: 3 min
Subject: New measures effective July 1, 2020
-IRPEF credit, tax deduction for employee income and new taxation for company cars for mixed use
This circular sets out the regulatory provisions introduced by the 2020 Budget Law and the Decree Law containing urgent measures to reduce the tax burden on employees, effective from July 1, 2020.
Although the Decree Law on measures to reduce the tax burden it provided for two different types of tax wedge reduction applicable based on the amount of total annual income from employment and similar sources, which take the form of a supplementary income allowance, which led to the repeal of the so-called Renzi Bonus but essentially follows the same rules, and an additional tax deduction.
Both tax wedge reduction mechanisms are subject to re-proportioning (If the amount subject to recovery exceeds €60, the substitute is required to divide the amount into four monthly installments starting from the month in which the adjustment is made) based on the period of work actually performed during the year, and given the effective date of application of the legislation, they will certainly be subject to re-proportioning for 2020 (recognized and re-proportioned for the July-December 2020 semester).
Supplementary treatment of income from employment and similar sources: IRPEF credit
This benefit, which totals €1,200, is intended to supplement the net pay of employees whose total annual income does not exceed €28,000. The beneficiaries of this measure are therefore workers whose annual income from employment or similar is greater than €8,173.00, i.e., workers whose gross tax after deductions for employment is positive.