The 2025 Budget Law (Law no. 207 of 30 December 2024 – Financial Law for 2025), effective from 1 January 2025, introduces a provision governing facilitated assignment to shareholders. Specifically, articles 1(31-36) outline a series of tax benefits related to the assignment or transfer to shareholders of real estate (other than those classified as instrumental assets) or movable assets registered in public registers not used as instrumental assets in the company’s business, or the transformation into a general partnership (società semplice) of companies whose sole or primary purpose is the management of such assets.
INDICE
- Scope of the Benefits
- Calculation and Application of Substitute Tax
- Determining Normal Value and Tax-Deductible Cost
- Taxation of Capital Gains and Post-Assignment Values
- Tax Effects on Shareholders and Holdings
- Indirect Taxes: Additional Benefits for Facilitated Transactions
- Operational Strategies to Rebalance Shareholders’ Positions
- Further Circumstances Favouring Facilitated Assignment in 2025
1. SCOPE OF THE BENEFITS ↑
Eligible Companies:
- General partnerships (società in nome collettivo)
- Limited partnerships (società in accomandita semplice)
- Limited liability companies (società a responsabilità limitata)
- Joint-stock companies (società per azioni)
- Limited partnerships by shares (società in accomandita per azioni)
The benefits apply specifically to assignments or transfers of the aforementioned assets to shareholders by 30 September 2025. The measure also extends to the transformation of companies whose sole or primary purpose is the management of these assets into limited partnerships (società semplice) within the same deadline. Crucially, all shareholders must be registered in the shareholders’ register by 30 September 2024 or within thirty days of the law’s entry into force, if a transfer deed with a certain date prior to 1 October 2024 exists.
Eligible Assets: Further Clarifications
In addition to non-business real estate and inventory, instrumental assets by nature (cadastral categories B, C, D, E and A/10) can also be included in the facilitated assignment, provided they are not directly used in the business activity (e.g., properties leased or unused by the company). Furthermore, in the absence of explicit limitations, properties located abroad, as well as movable assets registered in public registers such as motor vehicles, boats, and aircraft not used as instrumental assets, can also benefit from the scheme.
Why Reconsider the Facilitated Assignment
This new tax benefit presents a significant opportunity, even for those who considered but did not execute the operation under the previous 2023 scheme, especially if there were obstacles such as changes in shareholding after the deadline, which may now be overcome.
A significant change concerns the revaluation of business assets. The three-year monitoring period required by previous revaluation provisions has now expired, eliminating potential interpretative doubts about the loss of revaluation for assignments made during that period.
The recent reform of the regulations for non-operational companies (Law 111/2023), which aims to more clearly identify companies lacking real business activity, is another reason to consider this scheme. This could lead to increased scrutiny and tax risks for purely holding companies, making facilitated assignment an opportunity for tax risk reduction.
2. CALCULATION AND APPLICATION OF SUBSTITUTE TAX ↑
The scheme provides for the application of a substitute tax for income taxes and IRAP equal to 8%, calculated on the difference between the normal value of the assigned assets (or assets held in case of transformation) and their tax-deductible cost. For non-operational companies (so-called “shell companies”), the substitute tax increases to 10.5%. A 13% substitute tax also applies to tax-deferred reserves cancelled during the assignment or transformation. The substitute tax must be paid in two instalments: 60% by 30 September 2025 and the remaining 40% by 30 November 2025.
3. DETERMINING NORMAL VALUE AND TAX-DEDUCTIBLE COST ↑
The 2025 Budget Law allows the determination of the normal value of assigned properties using two criteria: the market value pursuant to Article 9 of the Consolidated Income Tax Law (TUIR) or the cadastral value, calculated by applying the cadastral multipliers provided for by Presidential Decree 131/1986. For transfers, the agreed consideration cannot be less than the normal value determined according to one of the two criteria mentioned. The tax-deductible cost is calculated according to Article 110 of the TUIR, considering depreciation and specific tax criteria for each category of assets (e.g., inventory).
Book Value of the Assignment
There is an ongoing debate on the book value to be attributed to the assigned asset. Prevailing doctrine suggests using the market value, which better represents the transaction from the perspective of protecting shareholders’ interests and accounting transparency. However, the Revenue Agency and notarial practice seem to also allow the use of the net book value, provided it does not exceed the available reserves of the net equity.
4. TAXATION OF CAPITAL GAINS AND POST-ASSIGNMENT VALUES ↑
Any capital gains deriving from the assignments benefit from a double tax advantage: a reduced substitute tax and the possibility of calculating the capital gain using the cadastral value instead of the market value, with the intermediate option between the two values. This can generate substantial tax savings compared to an ordinary taxation.
After the assignment, the tax-deductible value of the asset to the shareholder is the one used by the company to calculate the substitute tax (normal or cadastral), thus influencing any future taxable capital gains in the event of resale in the short term.
5. TAX EFFECTS ON SHAREHOLDERS AND HOLDINGS ↑
The legislation provides specific advantages for the assignees. The presumption of priority distribution of profits pursuant to Article 47 of the TUIR does not apply. The tax-deductible cost of the shareholders’ holdings is increased by the difference already subject to substitute tax, while the normal value of the assigned assets, net of any debts assumed, reduces this cost. This mechanism allows for efficient tax management of shareholdings, significantly limiting the tax burden on shareholders.
Although no longer explicitly required by the Revenue Agency for the application of the facilitated scheme, the principle of par condicio, i.e., equal treatment among shareholders, remains fundamental from a corporate law perspective. Shareholders must reach a unanimous agreement on the terms of the assignment, as any imbalances could generate corporate disputes. Although the principle of par condicio is not explicitly codified for corporations (with the exception of cooperatives), it is still considered a common and essential principle, potentially derogable only with the unanimous agreement of the shareholders themselves. However, the derogation must be used as a tool to facilitate the transaction and not to circumvent the general principle of fairness among shareholders. Par condicio becomes particularly complex to guarantee when the assignment to shareholders concerns assets in kind with values objectively difficult to determine precisely, such as real estate. Any imbalance could be compensated through cash payments, assumption of debts, or payments between shareholders, with the aim of achieving an equitable distribution of the overall value assigned.
6. INDIRECT TAXES: ADDITIONAL BENEFITS FOR FACILITATED TRANSACTIONS ↑
The facilitated assignment and transfer operations also enjoy tax advantages in terms of indirect taxes. The proportional registration tax, where due, is reduced by 50%, from 3% to 1.5%, for example. Mortgage and cadastral taxes are also applied at a fixed rate of €200 each. These measures make the operations provided for by the law particularly attractive.
7. OPERATIONAL STRATEGIES TO REBALANCE SHAREHOLDERS’ POSITIONS ↑
Several strategies can be used to comply with par condicio:
- Cash integration: The company distributes additional sums of money to shareholders who receive assets of lesser actual value to compensate for any imbalances in value.
- Debt assumption: The shareholder who receives assets of greater value can assume a company debt, thus reducing the net value of the assignment.
- Capital contribution: A shareholder makes a capital contribution to the company to rebalance the distribution of assigned values. This contribution can subsequently be distributed among all shareholders, with specific tax implications to be carefully considered.
Direct payment between shareholders: One shareholder compensates the other with a direct payment. However, this option could have direct income implications and further complicate the tax situation.
8. FURTHER CIRCUMSTANCES FAVOURING FACILITATED ASSIGNMENT IN 2025 ↑
- Reduction of VAT adjustment: Compared to the past, the passage of time makes facilitated assignment more advantageous due to the reduction in the amount of the adjustment of the VAT deduction pursuant to Article 19-bis2 of Presidential Decree 633/72, which decreases by one-tenth each year starting from the date of purchase or completion of the property (one-fifth for registered movable property). This means that in 2025, compared to 2023, it will be possible to remove the asset from the business regime with lower VAT burdens. It should be borne in mind that in some transactions, particularly those involving instrumental assets by nature or classified as “inventory”, the facilitated assignment can also have effects for VAT purposes. This happens, for example, when the company has partially or fully deducted VAT on purchase or during construction. In such cases, it is necessary to assess the obligation to adjust the deduction pursuant to the aforementioned Article 19-bis2, also in relation to the expiry of the monitoring period (10 years for real estate). The amount to be adjusted could affect the overall economic advantage of the operation. It is therefore essential to carry out a preliminary analysis with the support of your consultant to assess the feasibility and the most suitable timing.
- Willingness to cease activity: Another favourable circumstance may concern the desire, not present in the past, to cease business activity. In this case, the company’s properties would lose the requirement of instrumentality, making them suitable for facilitated assignment. This scenario could be particularly advantageous if there are potential third-party buyers interested in the property. In fact, it is possible to assign the property to the shareholders, revealing and subjecting the entire capital gain to substitute tax, and then resell it to third parties without risking challenges for abuse of law, as confirmed by the Revenue Agency in Resolution no. 93/2016.
- Compatibility with the “IRES premiale“: It is important to consider that the facilitated assignment scheme is compatible with the new “IRES premiale” scheme (Article 1, paragraphs 436-444 of the 2025 Budget Law), which allows for a reduction in the IRES tax rate to 20%, subject to the allocation of 80% of the 2024 profit. However, this compatibility is guaranteed only if the facilitated assignment is carried out using profits accrued up to 2023 or other available reserves. If, on the other hand, it becomes necessary to use more than 20% of the 2024 profit to carry out the assignment, the right to the preferential regime would be lost, even if the profit had initially been allocated.
- Payment of tax-deferred reserves: Article 14 of Legislative Decree 192/2024 introduced the possibility of paying tax-deferred reserves with a lower substitute tax of 10%, compared to the 13% provided for by the facilitated assignment scheme. This opportunity represents significant tax savings for partnerships. However, for corporations, the payment relates exclusively to the company’s position and does not cover taxes payable by the shareholders, unlike the 13% substitute tax provided for by the law on facilitated assignment.
- Engaging with our services: The complexities of the 2025 Budget Law’s facilitated assignment scheme necessitate careful planning and execution. Our firm possesses extensive expertise in navigating these intricacies, ensuring compliance and maximising the potential benefits for your specific circumstances. We encourage you to contact us to discuss how we can assist you in leveraging this valuable opportunity.
