Whoever has a company that works abroad can enter into preventive agreements with the Italian tax authorities to regulate the tax treatment of some transnational transactions in advance. The Revenue Agency has published a provision with instructions for accessing the procedure, introduced by Internationalization Legislative Decree. The indications of the tax authorities also apply to proceedings that have already started and are not concluded.
WHICH COMPANIES CAN PARTICIPATE
Companies with international activity can enter into preventive agreements. The Revenue Agency publishes the following list:
1) companies resident in Italy qualifying as such according to the legislation on income taxes and which, alternatively or jointly:
– are in one or more of the conditions contained in paragraph 7 of article 110 of the TUIR with respect to non-resident companies;
– have the assets, fund or capital of non-resident subjects or participate in the assets, fund or capital of non-resident subjects;
– have paid to, or received from non-resident subjects, dividends, interests, royalties or other income components;
– carry on their business through a permanent establishment in another State;
– are in the conditions indicated in articles 166 or 166bis of the Tuir (transfer of residence abroad).?
2) Non-resident companies which carry on or intend to carry on their business in the territory of the State through a stable organization.
OPERATIONS AT THE CENTER OF PRIOR AGREEMENTS
It is possible to sign preventive agreements only with reference to some particular operations. Among these, the transfer pricing regime (i.e. the procedure for determining the price in the transfer of ownership of goods or services between companies of the same group), the disbursement or receipt of dividends, interest, royalties and other income components and the definition of exit or entry values in case of transfer of residence.
In particular, "companies can access agreements - explains the tax authorities - to establish in advance the contradictory definition of the methods for calculating the normal value of intra-group transactions with companies resident abroad (article 110, paragraph 7 of the TUIR) and for define the application to a concrete case of rules, also of conventional origin, concerning the profits attributed to the permanent establishment in another State of a resident company or to the permanent establishment in Italy of a non-resident subject".
The second area concerns “the disbursement to non-resident subjects or the receipt by non-resident subjects of dividends, interests, royalties and other income components – continues the Agency -. The agreements may also have as object the definition of the exit or entry values in case of transfer of residence and the preventive assessment of the existence of the requirements that configure a permanent establishment located in the territory of the State".
HOW TO ENTER INTO PRIOR AGREEMENTS
To access the procedure, you must apply to the Advance Agreements and International Disputes Office of the Central Assessment Directorate of the Revenue Agency, Rome section (Via Cristoforo Colombo 426) or Milan (Via Manin 25). The application can be presented to one or the other structure, must be drawn up on unstamped paper and forwarded by registered mail with acknowledgment of receipt or by direct delivery to the Office. Depending on the type of application presented, the Revenue provision specifies all the data that businesses must indicate in the application (see paragraphs 2.3 to 2.8).
