[March 14th, 2017] Tax Newsletter - 2017 "Milleproroghe" Decree
- § “Reinforced derivation”: the so-called “reinforced derivation” principle, previously applied only to IAS-adopters taxpayers, is extended to OICs-adopters. This provision grants tax relevance to the representation of the economic substance of the transactions and, therefore, to the qualification, timing accrual and classification criteria of the financial statements. However, a transitional provision applies for transactions existing at the end of the fiscal year in progress at December 31, 2015 which are characterized by a new qualification, timing accrual or classification: in this case, the tax treatment related to the accounting criteria under the previous version of the OICs it is still applicable;
- § Interest expenses deductibility: the extraordinary negative and positive items deriving from the going concern transfers are not relevant for the computation of the deductibility threshold (30% EBITDA);
- § Expenses related to more than one fiscal year: expenses related to more than one fiscal year (e.g. advertising and other marketing costs) are deductible up to the amount accrued in the financial statements;
- § Items directly booked in the net worth: the items directly booked in the net worth under the new OICs are relevant for tax purposes, being assimilated to a profit and loss booking. However, based on a transitional regime, in the first year of the new OICs application the assets and liabilities adjustments are not relevant for IRES purposes;
- § Exchange rates: exchange rates published by international independent institutions are relevant for tax purposes, provided that they are made available by adequate publicity forms;
- § Financial derivative instruments: the accounting treatment of the financial derivative instruments provided by the new OICs is relevant for tax purposes. The transitional regime providing for the “reinforced derivation” does not apply to the financial derivative instruments existing in the fiscal year in progress at December 31, 2015;
- § ACE: the coordination between the new OICs and the Allowance for Corporate Equity discipline (ACE) will be provided by a decree to be issued by the Ministry of Economics and Finance.
In order to coordinate the IRAP discipline with the elimination of the profit and loss extraordinary section (items E.20 and E.21), starting from the fiscal year following the one in progress at December 31, 2015 (i.e. fiscal year 2016 for taxpayers adopting the calendar year), the extraordinary negative and positive items deriving from the going concern transfers are still not relevant for the IRAP taxable base computation.
Moreover, in the first year of new OICs application,
- § the items directly booked in the net worth under the new OICs are relevant for the IRAP taxable base computation if, based on the criteria applicable in the previous fiscal years, they would have been classified in profit and loss items relevant for IRAP purposes;
- § as provided for IRES purposes, the assets and liabilities adjustments are not relevant for IRAP purposes.
Extension for the deadline of 2017 IRES and IRAP tax returns filing for companies
For the fiscal year following the one in progress at December 31, 2015, the deadline for filing the IRES tax return (2017 Redditi SC form) and the IRAP return (2017 IRAP form) of the taxpayers adopting the new OICs is extended for 15 days. Therefore, for taxpayers adopting the calendar year, the deadline for the filing of 2016 tax returns is October 16, 2017.
Deadline for the filing of the VAT invoices data informative reports
For 2017, the VAT invoices data informative reports must be filed with the Tax Authorities on a six-monthly basis rather than on a quarterly one, i.e.:
- - by September 18, 2017 (as September 16 falls on a Saturday) for the first semester of 2017;
- - by February 28, 2018 for the second semester of 2017.
Starting from 2018, the deadlines will be on a quarterly basis again.
The VAT liquidations data informative reports must still be filed on a quarterly basis for 2017.