The voluntary contribution to the emergence of capital undeclared (so-called “voluntary disclosure”) is a procedure that could be called pacification tax, part of a broader program to combat the phenomenon of illegal international tax already recommended in 2010 by ‘ Organisation for Economic Co-operation and Development (OECD), and more recently in April 2013, the report of the Commission for the Study on self-laundering (Commission Greek). Since 2008, in fact, all the countries among the most recognized financial places (including Switzerland) under pressure from the G20 and other supranational organizations have begun to sign agreements comply with standards developed by the OECD, based on the principles of transparency and the exchange of information in tax. To take the example of Switzerland, in addition to having signed the OECD Convention on Mutual Administrative Assistance in Tax Matters and to have concluded several agreements on exchange of information for tax purposes, the Federal Council has launched January 14, 2015 for the two consultations’ introduction of the automatic exchange of information (called Common Reporting Standards approved by the OECD). After three years of negotiations, however, Switzerland has reached a final with Italy. It is expected that the agreement will have a leverage effect compared to the accession process since the change in the current art. 26 of the Treaty the Italian-Swiss double taxation will introduce the exchange of information between the two countries, dropping once and for all the historic bastion of banking secrecy. How rewarding effect, resulting in the signing of the agreement, the discipline of the voluntary disclosure provides the halving of sanctions monitoring tax. The agreement by the governments was signed on 23 February 2015 whilst for the ratification of their parliaments will take half a year or two. Even Liechtenstein and Monaco, have reached respective mind-February 26, 2015 and March 2, 2015, an agreement with the Italian Government with the same contents of the agreement concluded with the Swiss Confederation, which allows the exchange of information between the two countries in respect of all taxes imposed by their respective jurisdictions. Agreements just mentioned are added to further arrangements already in place and reached Italy with more countries or CDs tax havens, on the exchange of information.
It is clear that the voluntary disclosure program, in conjunction with the signing of the exchange of information, is born with the declared intent to return to Italy all those sums that were transferred out abroad in breach of the rules on monitoring radius tax (DL 28 June 1990 n. 167, converted by Law 4 August 1990, n. 227). The voluntary disclosure of assets held abroad is accompanied, however, the voluntary disclosure cd “National” consisting in the regularization of violations of obligations declarative in Italy committed with respect to taxes on income and on additional, substitute taxes, IRAP and VAT, as well as violations relating to declarations of withholding.
The procedure of regularization
The new form of regularization, introduced last December with the Law no. 186/2014, has been in force since 1 January 2015 and is addressed mainly to taxpayers resident in Italy (individuals, partnerships and non-commercial entities, including the Trust) who hold foreign investments and financial assets (through nominees ) in violation of the obligations of fiscal monitoring consisting in failure / RW unfaithful completion of part of the tax return. In the form of SO-CALLED national voluntary disclosure procedure is also accessible to business entities (corporations, partnerships, etc.) to regularize violations committed in Italy with tax relevance. The different components of assets that can be regularized are very numerous and, in general, coincide with all investments and financial assets that should have been declared under the Model Act Annual RW. As an example may be paid and current accounts, securities, insurance policies, real estate, jewelery and art assets. In the form of national voluntary disclosure can be regularized major undeclared taxable to the effects of income tax and the related additional substitute taxes, IRAP, VAT and withholding taxes. The taxpayer is required to provide to the tax authorities any documentary evidence necessary to determine the higher taxable income related to taxes due. The procedure of voluntary cooperation must be made by 30 September 2015, and will cover infringements committed until 30 September 2014. The procedure of voluntary disclosure must concern, then, all tax periods for which, at the date of submission of question, the deadline passed for the ordinary assessment of taxes and / or challenge the imposition of administrative tax penalties. For violations relating to the obligations of monitoring tax for investments held abroad, the annuity subject to tax assessment goes from 2009 to 2013 (investments held in non black list or countries with which Italy has reached an agreement to exchange information such as Switzerland, Liechtenstein and Monaco) and 2004-2013 (investments held in countries blacklist i.e. tax havens). For violations of taxes (income and VAT), in cases of unfaithful tax return, the tax years involved are those included in the 2010-2013 period or in the period 2006-2013 (if violations were committed by criminal-tax ). Where, however, the tax return has been omitted, the tax years still ascertainable are respectively included in the period 2009 2013 and in the period 2004-2013 (if violations were committed criminal tax).
The procedure can not be activated if the taxpayer’s application is submitted following initiation of access, inspections or audits or other assets tax assessment or penalty which has had formal knowledge and these are linked to the objective scope of application of the procedure .
The cost of the Voluntary Disclosure
Contrary to the forms of regularization in force in previous years, known as “tax shields”, the voluntary disclosure does not provide anonymity and is not expected any discount on the taxes due as a result of a possible emergence of higher taxable income but only a significant reduction applicable sanctions. Therefore, to be paid by the taxpayer of all the taxes arise from unreported income, including interest accrued. In general, therefore, the actual costs of the procedure in terms of taxes, penalties and interest can vary significantly and depend on several factors such as, for example, the taxation occurred or not, originally, the assets held abroad, the number ascertainable years depending on the country where assets are held, but also, for the purpose of sanctions on fiscal monitoring (RW framework of the Model Act) the number of years of infidel or non declaration of assets abroad. The costs for taxes and penalties will be naturally added professional fees of the professionals in charge who will refer to the rates indicated by the National Council of the Order of belonging (Lawyers or Accountants). The legislation provides for some form of simplification for the determination of the applicable taxes on financial income and the reduction of foreign sanctions on fiscal monitoring. In the first case, for the calculation of the returns of financial assets held abroad with consistency annual average of less than 2 million, there is a lump sum taxation option amounted to 1.35% (for financial assets is attributed to a return of 5% of the value measured at the end of the tax period, taxed at the rate of 27%). In the second case, the procedure of voluntary disclosure International recognizes the halving of the sanctions according to the infidel or failure to filling the framework of the Model Act Annual RW, fixing them at 1.50 / 0, provided the earlier of following conditions:
a) the assets are transferred in Italy or in the EU Member States or in States party to the Agreement on the European Economic Area that enable an effective exchange of information with Italy, included in the list of the decree of the Ministry of Finance of 4 September 1996;
b) the assets transferred in Italy or in the aforementioned states were or are held there;
c) the taxpayer releases foreign financial intermediary, at which the assets are held, the authorization to release to the Italian financial authorities requesting all data relating to the assets subject to the voluntary cooperation and attach a copy of such authorization, countersigned by the financial abroad, the request for voluntary cooperation;
d) States black-list in which the assets are held have signed before March 2, 2015 an agreement that allows an effective exchange of information (as in the cases of Switzerland, Liechtenstein and Monaco) and Provide the taxpayer to transfer the above activities in Italy or in European Union member states or foreign financial intermediary releases the authorization referred to in subparagraph c).
If the taxpayer fails to make the transfer or not to grant a license to the financial intermediary (taxpayer-called “non-transparent”), the minimum penalty will be applied according to the extent of 2.25% compared to the annual capital undeclared. In all cases, the sanctions undergo further reduction to one-sixth or one-third of the sanction definitively applicable depending on the taxpayer, respectively, accepts the quantification made by the Revenue taxes and / or penalties due; or, while deciding to establish a phase of its dispute with the Inland Revenue, provision for the payment of taxes and penalties again quantified within 20 days by the editors of the Act.
Completion of a Voluntary Disclosure and effects
The process of the procedure ends with the quantification by the tax authorities of the amount due from the taxpayer by way of taxes, interest and penalties. The payment of the aforementioned sums can be made in a lump sum or distributed in three monthly installments. The payment of the final installment due will have the effect of re-refines the procedure provided they are also verified the requirements of spontaneity, completeness and accuracy required by law reference.
The completion of the process will also result in the loss of the preconditions of criminal liability for tax offenses committed to holding activities result of avoidance, reward effect also with respect to the exclusion of punishment for the crime of money laundering and self-recycling (in force from 1 January 2015).