Transfer of non-controlling shares and “Realizzo controllato” tax regime

In reply to question no. 309 of 4 September 2020, the Tax Revenue Office provided some clarifications regarding the application of the transfers of non contolling shares according to art. 177, paragraph 2 bis, of the Consolidated Income Tax Law, introduced by Italian decree (Decreto Crescita).

The case concerns Alfa S.p.A., an unlisted company with a family shareholding structure, whose 24 shareholders hold non-qualified  shareholdings in different percentages. It is the intention of the company’s shareholders to carry out a corporate reorganisation project consisting in the creation of four family holding companies (which can be traced back to different branches of the family) at the head of the Alfa company. S.p.A. The four family holding companies would be set up through the transfer, by each shareholder, of Alfa S.p.A. shares in the holding company related to his family branch.

In its question, one of Alfa S.p.A.’s shareholders indicates that the transfer will not modify the shareholders’ pre-existing equity rights; moreover, the shareholding to be transferred will result in an increase in shareholders’ equity not exceeding the tax value of the shareholdings attributed to the transferring shareholders.

The tax issuer considers that he can benefit from the tax regime “realizzo controllato” according to art. 177, paragraph 2 bis, TUIR taking into account the fact that the holding company in question, and two of the other four holding companies, will receive shareholdings exceeding the qualification thresholds, i.e., a percentage of voting rights exercisable in the ordinary shareholders’ meeting higher than 2% or 20%, or a shareholding in the capital or assets higher than 5% or 25%, depending on whether they are securities traded on regulated markets or other shareholdings”, albeit thanks to the contribution of more than one transferor.

The Inland Revenue has denied the taxpayer access to the tax regime of “realizzo controllato” because “it does not satisfy the requirement set out in letter b) of Article 177 paragraph 2 bis”. This is due to the fact that, according to the law, non controlling shares  must be transferred to existing or newly established companies wholly owned by the transferor. The reference to the term “transferor” leads to the belief that the legislator’s intention is to favour the creation of exclusively single-member holding companies for the holding of qualified shareholdings.

In the case put forward by the applicant, on the other hand, the holding companies would acquire the qualified shareholding in Alfa S.p.A. thanks to the transfer of more than one transferor and therefore the newly formed holding companies would be held by more than one transferor.

Therefore, the proposed transaction cannot benefit from the “realizzo controllato ” tax regime according to paragraph 2-bis of art. 177 of the TUIR and is subject to taxation on the basis of the “normal value” criterion set out in art. 9 of the TUIR.

The Agency also wished to point out that, in the event that the transferee is a holding company, the transferor must verify whether or not it possesses the percentages for access to the realizzo controllato tax regime, also considering the shareholdings in commercial companies indirectly held, taking into account the effect of the demultiplication produced by the chain of shareholdings.

Antonio Orazio Della Corte