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Tax ruling for new investments in Italy by foreign companies

by Prof Roberto M. Cagnazzo

Foreign companies intending to make investments of a certain size in Italy may apply to the tax authorities for a special ruling to cover all aspects of their investment and obtain legal certainty.

To successfully apply for a new investment ruling, several substantive requirements must be met, and the planned investment must be at least EUR 15 million. To calculate this, all financial resources necessary for the implementation of the investment plan of the person concerned must be considered, including those of third parties.

When submitting the ruling, the investor must explain to the Italian tax authorities how the amount of the investment was calculated. Such amount may include:

  • Acquisition costs of tangible assets, including any ancillary costs (e.g. installation costs);
  • Costs of intangible assets; and
  • Costs of financial assets.

In addition, certain other requirements must be met for the investment to be eligible: 

  • The investment must be made in Italy; and
  • The investment must have a long-last impact on job creation.

If all other conditions provided for by the law are met, an investment in shares (for example, the acquisition of an Italian company) may also qualify for the scheme. 

The ruling should concern the tax treatment of the investment plan and any extraordinary operations planned for its implementation. The ruling request may also address the issue of the existence of a permanent establishment.

In particular, the ruling should include a detailed description of the investment, clarifying: 

  • The amount of the investment and the methodology used to quantify it;
  • Timing and method of implementation of the investment;
  • Impact on employment; and
  • Impact of the investment on Italian tax revenues.

According to the ruling request, questions may relate to any tax aspect within the competence of the tax authorities in connection with the investment plan.

Requests for rulings from non-resident entities that do not have a legal representative in Italy must be sent by regular email to a specific department of the tax authorities.

The Italian tax authorities will issue a written ruling within 120 days of the application, based on the investment plan and additional information provided by the applicant. If the tax authorities require additional information, the 120-day period may be extended by an additional 90 days from the date such additional information is provided to the requesting authorities. If the applicant does not receive a reply within the time limit, it is assumed the tax authorities agree with the proposed interpretation.

The tax authorities may not issue an act whose content is inconsistent with the content of the decision. If this is the case, the act issued against the content of the reply to the ruling is null and void. However, the tax authorities may make assessments aimed at verifying: 

  • Absence of changes in the factual and legal circumstances on which the response was based; and
  • The applicant's compliance with the answer given.


Prof Roberto M. Cagnazzo, Founder and Partner, is a chartered accountant and statutory auditor with considerable experience in domestic and international taxation acquired as Head of Tax in some of Italy’s leading multinational groups, and as Professor of Comparative Tax Systems and of Tax Law at the University of Turin.




18 April 2024

Prof Roberto Maria Cagnazzo

THREE & PARTNERS Accounting Tax Legal, Founder & Partner

THREE & PARTNERS Accounting Tax Legal