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Italy Finalizes Rules For New Patent Box Regime

Thursday, August 8, 2019

Italy's tax agency on July 30, 2019, published a definitive version of the rules for the operation of the country's patent box regime.

Protocol no. 658445/2019, released only in Italian, sets out, among other things, the rules for the determination of income covered by the preferential rate and the compliance obligations on those applying to be taxable under the scheme.

They are an update, following a public consultation that ended on July 24, 2019, to rules set out in a regulation published in the Official Gazette on February 4, 2019.

The regime, effective from the beginning of the year, increases the amount of the tax relief to 50 percent of qualifying expenditure against corporate income tax and regional tax liability, but ensures that the tax concession is available only for activities undertaken in Italy by resident individuals or corporations, or non-residents with a permanent establishment.