Tax credit for investment in capital assets

From FY 2020, new tax credits for investments in capital goods governed by the following regulations have been provided, replacing the previous benefits with maxi / hyper depreciation:

 

Subjects:

  • companies resident in Italy, regardless of their legal form, economic sector, size and income determination scheme;
  • subjects exercising arts and professions;
  • persons under a flat-rate regime.

 

Excluded subjects:

  • companies subject to bankruptcy proceedings (bankruptcy, liquidation, etc.);
  • recipients of disqualification penalties pursuant to article 9, paragraph 2, Legislative Decree no. 231/2001.

 

Conditions for the use of the benefit:

  • compliance with occupational safety regulations;
  • correct fulfilment of the obligations regarding the payment of social security and welfare contributions.

N.B.: for the latter condition it has not yet been clarified whether the requirement should be met in the year in which the transaction is carried out or also in those in which the tax credit is used.

 

Eligible investments:

  • New ”generic” assets (formerly super-depreciation);
  • New assets ”Industry 4.0” referred to in Annex A Law 232/2016 (formerly hyper-depreciation);
  • New intangible assets referred to in Annex B Law 232/2016.

Only for the benefit referred to in the 2021 Budget Law:

  • New ”generic” intangible assets.

Eligible investments can be made through the purchase of the property or through leasing.

 

Excluded Investments:

  • vehicles and other means of transport (art. 164, paragraph 1, TUIR);
  • assets which rates of depreciation is lower than 6.5% (pursuant to Ministerial Decree of January 1st 1988);
  • buildings and constructions;
  • assets listed in Annex 3 to Law 208/2015 (electricity, water, gas, transport and telecommunications industries);
  • assets that can be transferred free of charge by companies operating under concession and tariff in the energy, water, transport, infrastructure, postal, telecommunications, sewage collection and purification of waste and water and collection and disposal sectors.

 

Tax credit characteristics:

  • it cannot be transferred;
  • it is not IRPEF, IRES or IRAP relevant;
  • it is not relevant for the purposes of the deductibility ratio of interest payables;
  • it can be combined with other benefits provided that the cumulation does not exceed the cost incurred;
  • it must be reduced correspondingly in the event of sale for consideration or intended for foreign production facilities by 31.12 of the second year following the one in which the asset can be deemed as operative or interconnected.

 

Use of the tax credit:

The tax credit in question may be used exclusively by offsetting in F24 models and, for these purposes, is not subject to the following thresholds:

  • use of tax credits from the RU framework in the Income Tax Return, equal to € 250,000;
  • overall annual compensation limit in model F24 form, equal to € 700,000;
  • the non-offsetting regime provided in case of payables under tax audit for an amount higher than € 1,500;
  • for credits higher than € 5,000, for which the prior presentation of the Income Tax Return is not required.

 

Obligations required:

The subject to which the tax credit refers to are required to keep all documentation related to the costs occurred.

Express references to the regulations under consideration are also required on purchase invoices and/or other documentation related to the purchase. Invoices, even if electronic, can be amended and integrated by the buyer by indelible wording on the paper copy or by the drafting of an electronic supplementary document to be attached to the invoice itself and sent to the so-called “SDI” (sistema di interscambio).

For the purchase of tangible and intangible assets ‘Industry 4.0’ referred to in Annexes A and B, a specific communication to MISE and a sworn report certifying the interconnection of instrumental assets to the company system are also required. The latter can be replaced by a statement from the company’s legal representative in case of purchases lower than € 300,000.

 

Measure of the tax credit for the various benefits:

Download the attached pdf detailing the benefits by regulation and investment type.