Taxation on TFR (Italian termination benefits) exceeding 1.5 million euro

With Italian Ministerial Decree of 29 October 2010, published in Italian Gazette no. 300 the 15% solidarity contribution on maximum TFR amounts has been regulated – enacting article 1, paragraph 222, of Italian Law no. 296/2006.

With Italian Ministerial Decree of 29 October 2010, published in Italian Gazette no. 300 the 15% solidarity contribution on maximum TFR amounts has been regulated – enacting article 1, paragraph 222, of Italian Law no. 296/2006. TFR paid out in the period 2007-2009 for an amount greater than 1.5 million euro, will be subject to the above contribution. It will be possible to pay this debt in 18 monthly instalments.

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INPS: summary memo on the rules for year-end checks

By issuing Memo No. 162/2010, INPS has provided instructions for employers to use in making the reports for December 2010 or January and February 2011.

By issuing Memo No. 162/2010, INPS has provided instructions for employers to use in making the reports for December 2010 or January and February 2011. One of the most important aspects is the importance placed on compensation variables. In other words, if events or facts take place during the month that imply changes to the taxable compensation (i.e., compensation for overtime hours worked), employers are allowed to consider these changes when fulfilling the obligation and paying the contributions in the month following the month affected by these factors, without prejudice to the need to assign the contributions to the period in which they have accrued (the “accrual basis").

 

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INPS: bonus on defined-term contracts for hiring employees on availability lists

In its Notice No. 32661/2010, INPS has announced that hiring workers included on availability lists for defined-term contracts, including for contracts of longer than one year, for one of the reasons set forth under article 1 of Legislative Decree No. 368/2001 gives the employer the right to use the special terms for contributions described in Law No. 223/1991.

In its Notice No. 32661/2010, INPS has announced that hiring workers included on availability lists for defined-term contracts, including for contracts of longer than one year, for one of the reasons set forth under article 1 of Legislative Decree No. 368/2001 gives the employer the right to use the special terms for contributions described in Law No. 223/1991. These special contribution terms cannot exceed a period of 12 months.

 

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INPS (Italian National Institute of Social Insurance): new pension features becoming effective 1 January 2011

On 1 January of this year some new features introduced in recent years with Italian Law no. 247/2007 (Protocollo del Welfare – Welfare Protocol) and Italian Legislative Decree no. 78/2010 (Manovra Anticrisi – Anti-crisis legislation passed last May) will become effective:

On 1 January of this year some new features introduced in recent years with Italian Law no. 247/2007 (Protocollo del Welfare – Welfare Protocol) and Italian Legislative Decree no. 78/2010 (Manovra Anticrisi – Anti-crisis legislation passed last May) will become effective:

       new system for calculating the waiting period between the date when pension requirements are achieved and the time when the pension starts to be paid; therefore the waiting period is being changed into a period calculated for each worker, starting from the date the requirements are met, namely 12 months for employees and 18 months for self-employed and contract workers;

       increase in the amount, i.e. increase in the requirements necessary for obtaining old age pension; achievement of the right to pension will depend on reaching a certain age and a minimum number of contributions (so-called quota), which will increase annually until stabilising in 2013. For the year 2011, the value of this quota is fixed at 96, with a minimum age not under 60 years;

       increase of the minimum pension amount by 7 euro (equal to 460.97 euro).

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Conventional remuneration updated

The decree establishing 2011 conventional remuneration for individuals working abroad was published in the Italian Official Gazette no. 300 of 24 December 2010.

The decree establishing 2011 conventional remuneration for individuals working abroad was published in the Italian Official Gazette no. 300 of 24 December 2010. These values must be used to calculate the contributions for the obligatory social security for workers working in no-EU countries with which Italy has not signed a social security agreement or has signed a partial one.

(Il Sole 24 Ore)

Tax returns debut of CUD and 730 return form

The definitive CUD and 730 tax return forms have been published. In particular, the certification that employers will have to issue to workers by next 28 February 2011 contains important new features.

The definitive CUD and 730 tax return forms have been published. In particular, the certification that employers will have to issue to workers by next 28 February 2011 contains important new features. The area dedicated to sums paid for production bonuses has been completely revised. Given that the CUD is a condition per se sufficient for proving the existence of the reasons for a production bonus required by law, the section dedicated to notes (BX and BY) contains the explicit certification of the employer in this regard, as set forth by the Agenzia delle Entrate (Italian Tax Authority) resolution no. 130/E/2010. Another new feature involves the application of the additional rate of 10% on remuneration paid in the form of bonuses and stock options which exceed triple of the fixed part of remuneration. It is also necessary to certify in the notes for Abruzzo workers affected by the 6 April 2009 earthquake the suspended amounts for which taxation has resumed, but which have not been paid by the substitute tax.

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Tax abatement for overtime and incentive pay: lower income limits for 2010

A combined reading of the various laws regarding tax abatements for overtime and incentive pay, shows that verification of the income possessed by an employee in 2009,

A combined reading of the various laws regarding tax abatements for overtime and incentive pay, shows that verification of the income possessed by an employee in 2009, for the purposes of recognising a tax abatement for the year 2010, must be performed by adding the amounts of tax abatement during 2008, or to a maximum of 3,000 euro to the taxable income contained in box 1 of the CUD form.

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Extension of Derogation for Cassa Integrazioni Guadagni (redundancy benefits) for 2011

The derogation of the redundancy benefits, since its introduction with the “anti-crisis” decree (Italian Legislative Decree no. 185/08, converted into Italian Law no. 2/09) has been the only instrument enterprises can use which are normally excluded from applying the redundancy benefits due to the type of employment contract, company sector or company size.

The derogation of the redundancy benefits, since its introduction with the “anti-crisis” decree (Italian Legislative Decree no. 185/08, converted into Italian Law no. 2/09) has been the only instrument enterprises can use which are normally excluded from applying the redundancy benefits due to the type of employment contract, company sector or company size. The 2011 economic  manoeuvre, approved last week, establishes an extension of this benefit for 2011 as well: based on specific government agreements the Ministry of Labour can grant redundancy benefits, by means of derogation, for a maximum period of 12 months. This is while waiting for an overall reform of the fund, recently pushed by the Collegato Lavoro (Labour Law) delegating this task to the government to enact it in the next 24 months.

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INPS (Italian National Institute of Social Insurance): INPS requirements for freelance professionals with a separate pension fund waived

INPS with its message no. 31002/2010, stated that the same Institute as of 1 January 2005 had automatically registered with the office managing freelance INPS contributions all individuals who declared income on form RE of the PF tax return for 2006 and who appear not to have paid contributions to this office.

INPS with its message no. 31002/2010, stated that the same Institute as of 1 January 2005 had automatically registered with the office managing freelance INPS contributions all individuals who declared income on form RE of the PF tax return for 2006 and who appear not to have paid contributions to this office. This registration is part of an auditing operation related to contribution positions, called PoseidOne, started in 2009. From this group INPS has excluded anyone who declared income from freelance work who is required to pay contributions to a professional pension fund.

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Debut of work stress test

Starting on 1 January 2010 all companies of all sizes – public and private – must perform, in accordance with Italian Legislative Decree no. 81/08, an assessment of all company risks, including the risk related to connected work stress.

Starting on 1 January 2010 all companies of all sizes – public and private – must perform, in accordance with Italian Legislative Decree no. 81/08, an assessment of all company risks, including the risk related to connected work stress. The assessment takes place in two phases: the first mandatory phase, entails a survey of statistical data, early warning events, contents and work context; the possible second phase, is characterised by the adoption of corrective measures for the case if significant stress elements emerge.

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Tax abatement for overtime: the employer justifies the sums in the CUD

The Agenzia delle Entrate, with its resolution 130/E issued yesterday, stated that if the employer states in the Cud the requirement of production or organisational efficiency motives for the sums paid (overtime, nighttime work or shift work), the tax abatement of 10% cannot be disputed by inspection bodies.

The Agenzia delle Entrate, with its resolution 130/E issued yesterday, stated that if the employer states in the Cud the requirement of  production or organisational efficiency motives for the sums paid (overtime, nighttime work or shift work), the tax abatement of 10% cannot be disputed by inspection bodies. Therefore, the employer is not required to provide any additional documentation as proof. At this point it becomes indispensable to issue a Cud to the employee which must occur also for employment terminated during 2008 and 2009 (in addition to 2010).

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