Obtaining tax credits

There are 4 provisions for obtaining Tax credits: Instrumental Goods, R&S, Training and Advertising

(L.27/12/2019 n.160)

Instrumental Goods tax credits (art. 1 comma 185-197)

The measure replaces super depreciation and hyper-depreciation (which have not been renewed).

Period

 01/01/20 – 31/12/20. However, the period can be as long as 30/06/2021. This is provided that the order was placed by 12/31/2020 and a down payment of at least 20% has been paid.

Investments that can be financed by goods

  • Instrumental materials, which have a percentage of 6%
  • 4.0 Industry Instrumental Materials , these with a percentage of: 40% 
  • 4.0 industry Intangibles Insmaterial, with a percentage of: 15%

Excluded assets: real estate and vehicles.

Goods requirements: novelty, instrumentality and territoriality.

Fulfilment 

  1. In the documents, the reference to the 184 and 194 commi must be made. Whether it is orders or invoices.
  2. For 4.0 industry goods, simple technical expertise by an engineer or industrial expert must be produced. They must attest that the goods possess the characteristics to be considered Industry 4.0 and that they are interconnected. Subsequently, if the property costs less than 300,000 euros, the expert opinion can be replaced by a well-known act signed by the legal representative.

Using Tax Credits

Compensation is carried out in the year following that of the commencement of the assets and to that of the interconnection year for industry 4.0 assets.

  • 5 years for material goods
  • and 3 years for intangibles

R&S tax credit (art. 1 commas 198-209)

The measure replaces super depreciation and hyper-depreciation. That both have not been renewed.

Among the investments that can be financed there are:

  • Research and development with a credit of 12%. They are classified as follows:
      1. Fundamental research: studies without direct applications and direct commercial uses
      2. Industrial research: investigations to gain new knowledge to develop new products, services and processes
      3. Experimental development: using knowledge to produce new projects or products, processes or services and prototyping
CALCULATION BASIS
Staff
Depreciation share of material and software assets
Extra walls contracts
Industrial privaties
Consulting
Materials
  • Technological innovation: 6% credit
CALCULATION BASIS
Staff
Depreciation share of material and software assets
Contracts for activities by the commissioner
Consulting
Materials
  • Technological innovation 4.0: 10% credit
CALCULATION BASIS
Staff
Depreciation share of material and software assets
Contracts for activities by the commissioner
Consulting
Materials
  • Technological innovation 4.0: 10% credit
CALCULATION BASIS
Staff
Depreciation share of material and software assets
Contracts for activities by the commissioner
Consulting
Materials
Note. The percentage applies to expenses, net of any contributions made for the same investments.

Period

 01/01/20 – 31/12/20. This period can be as long as 6/30/2021. But only if the order was placed by 12/31/2020 and a down payment of at least 20% has been paid.

Excluded assets: real estate and vehicles.

Goods requirements: novelty, instrumentality and territoriality.

Fulfilment 

  1. The first is a presentation of a special communication to the Ministry of Economic Development
  2. Then the certification of the person in charge of the audit and related expenses. Expenses that are recognized in the tax credit of up to 5,000 euros.
  3. Finally, a technical report signed by the legal representative.

Using Tax Credits

First of all, it is compensated in three annual allowances of the same amount. These will then go from the tax credits period following the period of the support of expenditure.

BONUS TRAINING

Prolong Tax Credits

In detail, paragraph 210 states that

There is a bonus discipline for the training costs of employees to acquire or consolidate skills in technologies relevant to technological and digital transformation under the National Enterprise Plan 4.0. In detail, paragraph 210 states that it also applies to training costs incurred in the tax period following the current tax period of 31 December 2019. The benefit is also confirmed for 2020.

Budget Law 2018

The law provided for Tax credits for Business. It provided a maximum annual amount of up to EUR 300,000 for each beneficiary only if the training activities are agreed through collective corporate or territorial agreements. This does so regardless of legal form. But also regardless of the economic sector in which they operate as well as the accounting regime adopted.

These activities will be used to acquire or consolidate the knowledge of the technologies provided for by the National Industry Plan 4.0. These include: big data and data analysis, cloud, fog computing, cyber security, cyber-physical systems, rapid prototyping, augmented reality and visualization systems, advanced and collaborative robotics, machine human interface, additive manufacturing, IOT and machines, and digital integration of business processes.
Training activities, ordinary or periodic, organised by the company to comply with workplace health and safety and environmental protection standards or other mandatory training standards, are excluded.

Budget Law 2019

With the Budget Act 2019 (Article 1, paragraph 79 of Law No. 145 of 2018) the benefit has been adjusted according to the size of the companies with respect to: 

  • small businesses. Tax Relief with Tax Credit is recognized at 50% of eligible expenses and in the maximum annual limit of 300,000
  • medium-sized enterprises. Tax credits are recognized at 40% of eligible expenses and in the maximum annual limit of 250 thousand euros
  • big business. Tax credits are recognized at 30% of eligible expenses and in the maximum annual limit of 250 thousand.

The actual use of the bonus is, therefore, subject to the condition that the company is not subject to interdictive penalties. It must also comply with workplace safety regulations and obligations to pay social security and welfare contributions to workers.

Comma 213

This section stipulates that, if training activities are provided by non-corporate parties, they are considered eligible for Tax credits:

  • universities, public and private
  • facilities related to them and to those accredited to inter-professional funds and in possession of quality certification under the Uni En Iso 9001:2000 EA 37
  • and also the activities commissioned by the higher technical institutes

In addition, of course, to the activities commissioned by accredited persons for the conduct of training activities financed in the autonomous region or province.

Comma 214

Paragraph 214 specifies that the tax credits can be used, starting from the tax period following the tax period for the support of eligible expenditures, solely in compensation. But it cannot be sold or transferred even within the fiscal consolidation.

Companies that use Tax Credits or Tax Facilities, according to this paragraph, must make a communication to the Ministry of innovation. The model, content, mode and terms of submission will be established by a special directorial decree.

Comma 215

Section 215 removes the obligation to expressly regulate the conduct of training activities in corporate and territorial collective agreements.

Comma 217

Finally, paragraph 217 provides for compliance under EU Regulation. The Ministry of Economic Development provides 651/2014 in terms of aid compatible with the internal market. In this respect, Article 31 of this EU regulation allows training aid under certain conditions. These include that the intensity of aid does not exceed 50% of the eligible costs, which includes staffing costs for training participants.

Credit Advertising

The tax credits is 75% of the incremental value of the investments made.

In addition, the total amount of advertising investments made must exceed a certain percentage to qualify for Tax Credits. That is at least 1% of the amount of similar investments made in the same media in the previous year.

How does that work

In order to benefit from Tax credits, stakeholders must submit:

  • Communication for access to tax credits.” Which contains data on investments made or to be made in the facilitated year
  • Replacement Declaration on Investments Made.” Useful to declare that the investments indicated in the communication for access to Tax credits were actually made in the facilitated year.

The amount of tax credits that each applicant can actually use is determined by order from the Department of Information and Publishing. It will then be published on the Department’s institutional website.

Tax credits with Recognized Tax Credits can only be used in compensation using the F24 model. Model to be presented through the Internal Revenue Service’s telematics services.

When to present the communication

The communication for access to Tax credits and the replacement declaration relating to investments made are submitted to the Department for Information and Publishing of the Presidency of the Council of Ministers. All this through the telematics services made available by the Revenue Agency, directly by the authorized parties.

Communication for access to Tax Credits must be submitted from 1 to 31 March of each year. The replacement declaration on investments made from 1 January to 31 January of the following year.

What’s new about the decree “Cura Italia”

With the decree “Cura Italia” we find two important innovations;

  1. 30% is set for the entire 2020 investment, and not just the incremental part of the previous year. This is to deal with the Coronavirus emergency. In addition, the right to relief remains conditional on investments being incremental by at least 1% compared to the year before.
  2. Among the new features is the 6-month deferral of the sending of the telematics communication of access to Tax credits. The new applications, therefore, exceptionally for this year can be submitted from 1 to 30 September 2020. Finally, they will be added to those already submitted between 1 and 31 March 2020, which will remain valid.

Admitted persons can use Tax Credits, starting on the fifth business day after the publication of the admission order. This will be done in compensation for the F24 model through the Revenue Agency’s telematics channels. If the sum exceeds 150 thousand euros, you must wait for the individual communication of enabling.

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