The individual savings plans saw the light at the beginning of 2017 with the noble aim of channeling investors' savings towards small and medium-sized Italian companies in the face of interesting tax advantages.
The PIRs were welcomed, indeed with euphoria by savers and operators in the sector. It is a pity that the legislation relating to these instruments was unclear, at times incomplete, in certain points even incorrect (sic). But the remedy has arrived, in the form of a decree law dated April 24, which should have clarified any doubts once and for all. Let's see the main clarifications, point by point. It won't be easy, but stay with us because we'll explain what's really important.
The main changes
One of the main sources of uncertainty, recalls Assogestioni, was caused by a real "typo" present in the first draft of the legislation: specifically, the error was found in paragraph 101 which, erroneously, referred to paragraph 90 for the list qualified investments to benefit from tax advantages. In reality, the list to refer to is not found in paragraph 90, but in paragraph 102. Headache numbers aside, the gist is that to benefit from the non-taxability of income deriving from investments in PIR it is necessary that, in each calendar year of the duration of the plan and for at least two thirds of the year:
– at least 70% of the sums are intended for financial instruments, including those not traded on regulated markets;
– these instruments are issued by companies that carry out activities other than real estate;
– the broadcasters are fiscally resident in Italy (or in member states of the European Union or in member states of the agreement on the European economic area with permanent establishments in Italy);
– 30% of that 70% – which is equivalent to 21% of the total investment – is made up of shares of companies NOT included in the Borsa Italiana FTSEMIB index, for example those listed on alternative lists, such as the AIM (Mercato Alternativo of the Capital);
– all of this applies simultaneously.
Among other things, it is important to underline that the investments in question can be made indirectly, through Italian or foreign mutual funds (including SICAVs), provided that they comply with the constraints and limits of the decree.
Paragraph 113, on the other hand, is reformulated to highlight the importance of accounting separation, which aims to keep compliance with obligations under control and to trace movements. Since, in fact, the PIR legislation does not provide for the obligation to keep a report on sums or values, it is necessary that financial intermediaries and insurance companies can guarantee correct accounting separation.
To reinvest the sums obtained after the repayment of the financial instruments on expiry, the days envisaged are no longer 30 and the period of time is extended to 90 days.
Tax breaks, which ones and how to take advantage of them?
The tax breaks are among the major attractions of the PIRs, in fact, in compliance with certain conditions, they grant total exemption from taxes on the income generated by the investment itself and from the inheritance tax (the subscriber dies).
However, this exemption is to be considered within the limits of 5% of the assets resulting from the previous year's report, provided that the investments are maintained for 5 years. Of course, you can always disinvest before the deadline, but in this case the tax benefit is lost and the taxes are not only paid, but with the late payment (it's good that this too is clear).
The advantage, however, is that a rate of 0% is applied to PIRs. In addition, the legislation on the tax credit due to supplementary pension schemes and compulsory pension funds in relation to invested income was repealed.
What's important?
If you have metabolized the changes to the legislation point by point, it is clear that some improvements are on the way. Which?
– To invest in PIR it is not necessary to open a new securities account
– The obligation to keep accounts lies solely with the bank
– More flexibility: 90 days to reinvest the sums and the possibility of direct purchases of securities or funds for at least 2/3 of the year
