Offshore payout structure for Italian tax resident

[JohnnyDoe]

Thanks for the feedback and the link @Martin Everson

By the way guys, in the flat tax description, what is meant by the part in bold:

It means that if you own over 2/5% of a listed company or 20/25% of a private company (depending if your ownership has or not voting rights), you cannot include the sale of those stocks in the flat tax in the first 5 years.
In other words: you cannot move to Italy and exit your business immediately tax free, you must wait 5 years.

 

[Hito]

It means that if you own over 2/5% of a listed company or 20/25% of a private company (depending if your ownership has or not voting rights), you cannot include the sale of those stocks in the flat tax in the first 5 years.
In other words: you cannot move to Italy and exit your business immediately tax free, you must wait 5 years.

Excellent clarification, thanks @JohnnyDoe

What about giving away the company to someone else, whilst remaining to live in Italy? Would that be a viable solution?

 

[JohnnyDoe]

Excellent clarification, thanks @JohnnyDoe

What about giving away the company to someone else, whilst remaining to live in Italy? Would that be a viable solution?

Why should you do so? You can keep the company as the dividends are covered by the flat tax.

 

[Hito]

Why should you do so? You can keep the company as the dividends are covered by the flat tax.

I was thinking along the lines of closing the company as you suggested before. Given that the flat tax doesn’t cover capital gains from funds moved after dissolving a foreign company until the 6th year, this might be an alternative solution to distancing & closing quickly, yet continuing to live in Italy.

 

[JohnnyDoe]

I was thinking along the lines of closing the company as you suggested before. Given that the flat tax doesn’t cover capital gains from funds moved after dissolving a foreign company until the 6th year, this might be an alternative solution to distancing & closing quickly, yet continuing to live in Italy.

“Giving away” the company will not withstand a tax investigation.

 

[Hito]

“Giving away” the company will not withstand a tax investigation.

Makes perfect sense.

if you are planning to move (but you need to do that for real! Leave no assets in Italy) I suggest you only pay the 100k for 2021 and run away as fast as you can. You still need to close the company and hide the money, but you have good chances to avoid troubles.

Johnny, do you happen to know how the Italian exit tax might affect the above scenario?

 

[JohnnyDoe]

Johnny, do you happen to know how the Italian exit tax might affect the above scenario?

There is no exit tax for individuals. Chances are that a person taking advantage of the €100k flat tax who moves his residence outside Italy will be left alone by the Italian authorities. Of course as long as the expatriation is real and no assets are left in Italy.

Keep in mind that nothing is certain in Italy and that there are just too many laws to be sure of anything. Plus, the flat tax regime is relatively new and there is not enough jurisprudence yet to be able to forecast the outcome of specific situations.

 

[Hito]

There is no exit tax for individuals. Chances are that a person taking advantage of the €100k flat tax who moves his residence outside Italy will be left alone by the Italian authorities. Of course as long as the expatriation is real and no assets are left in Italy.

Keep in mind that nothing is certain in Italy and that there are just too many laws to be sure of anything. Plus, the flat tax regime is relatively new and there is not enough jurisprudence yet to be able to forecast the outcome of specific situations.

What about an owned foreign company which under CFC rules was also technically an Italian tax resident in 2021?

Do you happen to know what exit tax rules it would trigger if it moves outside the EU? @Martin Everson

 

[burden]

Thanks for your feedback Johnny. Would it be feasible to get a credit card for the ltd and use it directly, instead of the funds ever being moved into a personal account? The current bank doesn’t issue cards.

why credit card, get a Wise account and debit card.

 

[JohnnyDoe]

What about an owned foreign company which under CFC rules was also technically an Italian tax resident in 2021?

Do you happen to know what exit tax rules it would trigger if it moves outside the EU? @Martin Everson

If it’s resident in Italy you are supposed to have an Italian accountant taking care of it. If you don’t have one you should better find it quickly and fix your position.