Income Tax Hike for Dormant Companies in Italy

(Sunnyvale, CA) - Dormant companies in Italy will be paying a higher corporate tax rate in 2012 as per the new Italian tax law. Companies that can be considered ‘dormant’ will have to pay 38% corporate income tax (IRES) tax rate next year compared to the current rate of 27.5%.

The corporate income tax increase however, will not affect Unlimited Liability Companies (ULC) or personal companies.

The law also extends the ‘dormant’ discipline to companies facing financial losses for three consecutive years.

Tax rates for dormant companies in Italy

Companies are considered as ‘dormant’ when their regular revenues are lower than the following balance sheet items:

2% for shares or other participating instruments and financial credits;
6% for real estate assets (reduced to 5% for office buildings or 4% for buildings purchased during the same year of application);
15% for all other tangible and intangible fixedassets.
E.g., If a company owns an office building valued € 500.000,00, minimum revenues should be € 25.000,00 (or the 5% of € 500.000,00). If actual revenues are € 18.000,00, the company is considered a “dormant” company (unless the company applies for seeking exemption from these provisions).
Income Tax Pre-Payments

The new tax rates would need to be considered while calculating income tax pre-payments due for 2012 or the year following the effective date of September 17th, 2011.

Please call or email for advice on tax deductions related to dormant companies in Italy.

About Nair & Co.
Nair & Co. provides you with your one touch outsourced finance, internal audit compliance, HR and legal department for your international operations. If you are expanding abroad for the first time, our turnkey solution will help you do so with minimal risk, stress and cost. We currently support more than 1000+ client operations in over 50 countries and have core offices in U.K., India, China, U.S., Japan and Singapore. Nair & Co. was named among the top 100 outsourcing services providers in the world by the International Association of Outsourcing Professionals (IAOP). Learn more at www.nair-co.com

Nandita Verma
Nair & Co.
nandita.verma@nair-co.com
408-515-9048
Nair & Co., 1250 Oakmead Parkway, Suite 210
Sunnyvale, CA 94085 United States

This release was published on openPR.