Eutekne - Italy's leading professional publisher for lawyers and accountants - published, in the September issue of the magazine "La Consulenza del Lavoro," the focus "Application of the inbound expatriate tax regime to employees returning to Italy from a posting abroad" created by Tommaso Fonti, LL.M. and Valeria Zega of the Global Mobility Department.
The recent publication deals with a much-debated topic in the post-pandemic that affects many companies: the return of human resources to Italy and the tax reliefs to facilitate it.
The publication takes its cue from sentence no. 1479/2022 of the Provincial Tax Commission of Milan, which admitted the application of the inbound expatriate tax regime in favour of employees returned to Italy at the end of a posting abroad only if the requirements set forth in Article 16 of Legislative Decree 147/2015 are met.
Prior to the aforementioned ruling, the Italian Revenue Agency allowed the inbound expatriate tax regime for the employee returned to Italy from a posting abroad only if, in addition to the requirements set forth in Article 16 of DLgs. 147/2015, two additional requirements are met:
- the discontinuity between the job role held by the employee before and after the posting; this requirement is hard to meet, since the return to Italy of the posted employee usually takes place in continuity with the previous employment relationship, precisely because of the nature of the posting;
- the stipulation of a new employment contract between the returned employee and the Italian employer.
The inbound expatriate tax regime also applies to employees who move to Italy to work in smart working for a foreign employer. However, our authors point out that, in this case, the Italian Revenue Agency did not adopt a restrictive approach, but admitted the application of the above mentioned tax regime simply if the requirements set forth in Article 16 of Legislative Decree 147/2015 are met, without any reference to the additional two requirements of the discontinuity of employment and the new employment contract.
For our authors, therefore, there is a clear disparity of treatment in the application of the inbound expatriate tax regime between two substantially similar situations: that of employees returned to Italy after a posting abroad and that of employees moved to Italy to work in smart working for a foreign employer.
With this publication continues the collaboration of Bacciardi Partners' Global Mobility Department with Eutekne, whom we thank again for the opportunity.
For more information and to read the full article on the requirements and applicability of the inbound expatriate tax regime: eutekne.it/sile
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