Amendments to the Flat Tax Regime for New Residents (Art. 24-bis TUIR) – Art. 1, paragraphs 25–26
The 2026 Budget Law amends the optional substitute tax regime provided under Art. 24-bis of the TUIR, increasing the amount of the annual substitute tax payable by individuals transferring their tax residence to Italy.
Specifically:
- The substitute tax is increased from €200,000 to €300,000 for the main taxpayer;
- The amount due for each family member is raised from €25,000 to €50,000.
The increase applies exclusively to individuals who transfer their civil residence to Italy after 31 December 2025, pursuant to Art. 43 of the Civil Code.
Changes Regarding Crypto-Assets – Art. 1, paragraph 29
The 2026 Budget Law amends the rules on income derived from crypto-assets, revising Art. 1, paragraph 24, of Law No. 207/2024 (2025 Budget Law).
Specifically:
- The substitute tax rate on miscellaneous income and other proceeds under Art. 67, paragraph 1, letter c-sexies) of the TUIR is reduced from 33% to 26% for income from electronic money tokens denominated in euro (so-called euro-tokens), as defined by EU Regulation 2023/1114;
- It is clarified that the following do not constitute the realisation of capital gains or losses:
- Mere conversion between euro and euro-tokens;
- Redemption in euro of the nominal value of euro-tokens.
Financial Transaction Tax (Tobin Tax) – Art. 1, paragraphs 30–31
The financial transaction tax (commonly referred to as the Tobin Tax) applies to three types of transfers of shares and equity instruments, as follows:
- Transfers of ownership of shares and equity instruments issued by companies (Art. 1, paragraph 491 of Law 228/2012);
- Derivative contracts and securities with shares as the underlying (Art. 1, paragraph 492 of Law 228/2012);
- “High-frequency trading” transactions (Art. 1, paragraph 495 of Law 228/2012).
Specifically, an increase in Tobin Tax rates is introduced for:
- Transfers of ownership of shares and equity instruments:
- From 0.2% to 0.4% for securities not traded on regulated markets or multilateral systems;
- From 0.1% to 0.2% for securities traded on regulated markets;
- High-frequency trading transactions, where the rate rises from 0.02% to 0.04%.
The above new rates apply to transactions carried out from 1 January 2026.
Facilitated Allocation to Shareholders and Removal of Assets from Sole Proprietorships – Art. 1, paragraphs 35–41
The temporary regime for the facilitated allocation of non-instrumental real estate or registered movable assets to shareholders, as well as transformation into a simple partnership, is reintroduced and must be completed by 30 September 2026.
Specifically, on the difference between:
- The normal value of the allocated assets (or the value of assets in case of transformation),
- And the tax-recognised cost,
a substitute tax applies:
- 8%, or
- 10.5% for companies that were non-operational in at least two of the previous three periods.
Tax-suspended reserves are subject to a substitute tax of 13%. Registration taxes are reduced by half; mortgage and cadastral taxes apply at a fixed rate.
Payment of the substitute tax must be made:
- 60% by 30 September 2026;
- 40% by 30 November 2026.
For sole proprietorships, the facilitated removal of instrumental real estate owned as of 30 September 2025 is confirmed, with exclusions carried out from 1 January to 31 May 2026. The substitute tax (8%) must be paid by 30 November 2026 and 30 June 2027.
Rationalisation of the Instalment of Capital Gains on Business Assets – Art. 1, paragraphs 42–43
The rules under Art. 86, paragraph 4, of the TUIR have been rewritten. Specifically, the option to spread taxation over five annual instalments is now limited to capital gains:
- Arising from the sale of a business or business branch held for at least three years;
- Realised by professional sports companies on the transfer of rights to athletes’ services (with a minimum holding period of two years).
All other capital gains, excluding those under Art. 87 of the TUIR (i.e., participation exemption), are taxed in full in the year of realisation and can no longer be spread over five annual instalments.
Intra-EU/EEA Dividends and IRAP – Art. 1, paragraphs 46–50
Subject to certain conditions, 95% of dividends received by banks, financial intermediaries and insurance companies from EU or EEA companies with adequate information exchange are exempt from IRAP.
This measure applies from the tax period in progress as at 31 December 2025. For previous periods, it is possible to request a refund pursuant to Article 38 of Presidential Decree No. 602/1973
An implementing measure by the Director of the Revenue Agency will establish the rules regarding refunds.
Dividends and Capital Gains on Shareholdings – Art. 1, paragraphs 51–55
The 2026 Budget Law revises the rules on the participation exemption for dividends (Arts. 59 and 89 of the TUIR) and capital gains (Arts. 58 and 87 of the TUIR).
Specifically, the regime of partial exclusion or exemption of dividends and capital gains is now reserved for direct shareholdings in the capital of not less than 5%, or alternatively, with a tax value of not less than €500,000. Where shareholdings fall below this threshold, distributed dividends and realised capital gains will be fully subject to IRES and IRPEF.
This tightening also applies to capital gains realised on shareholdings in non-resident entities and to foreign-source dividends.
Furthermore, these provisions also apply to dividends distributed to companies and entities subject to corporate income tax in EU Member States and EEA States included in the so-called “white list” and resident therein, which cannot benefit from the “parent-subsidiary” regime on shareholdings that do not meet the new qualification thresholds. In such cases, domestic withholding tax of 26% will apply (subject to reductions under applicable double taxation treaties).
The new requirement relating to the size of the shareholding applies to capital gains arising from the disposal of shareholdings acquired from 1 January 2026 and to distributions of profits and reserves resolved from 1 January 2026.
Write-downs on Loans and Deferred Tax Assets (Financial Intermediaries) – Art. 1, paragraphs 56–57
For the tax period following that in progress on 31 December 2025 and for the subsequent three years, with regard to financial intermediaries, it is established that for loans classified in the first and second stage of credit risk, write-downs arising exclusively from the adoption of the expected credit loss model for provisioning against credit losses shall be deductible in five equal instalments starting from the year in which the loss is recognised in the income statement. This is by way of derogation from what is provided for IRES and IRAP purposes under Article 106, paragraph 3 of the TUIR and Article 6, paragraph 1, letter c-bis) of Legislative Decree No. 446/1997.
Consequently, the possibility of converting deferred tax assets (so-called DTAs) recorded in the financial statements into tax credits, in connection with the deferral of deductibility of these income components (Article 2, paragraphs 55, 56-bis, 56-bis.1 and 56-ter of Decree-Law No. 225/2010), and of including them in the taxable base for the DTA fee that financial intermediaries must pay annually to benefit from the regime for converting DTAs into tax credits (Article 11, paragraph 2, Decree-Law No. 59/2016), is eliminated.
Valuation of Securities for Non-IAS Adopters – Art. 1, paragraphs 65–67
For the financial years 2025 and 2026, entities that do not adopt international accounting standards are allowed to value securities not intended to remain permanently in their assets based on their book value rather than the realisable value inferred from market trends, except for permanent losses.
This option requires the allocation of a non-distributable reserve of profits equal to the difference between the values recorded under this option and the market values as at the closing date of the reference period, net of the related tax burden. If the profit for the year is less than the amount of the difference, the reserve must be supplemented using profit reserves or other available equity reserves or, failing that, through profits from subsequent years.
For insurance and reinsurance companies that do not use international accounting standards, IVASS will define the implementing and application rules for this option through its own regulation.
Increase in IRAP Rates for Banks and Insurance Companies – Art. 1, paragraphs 76–81
An increase is introduced in the IRAP rate applicable to financial intermediaries (from 4.65% to 6.65%) and insurance companies (from 5.9% to 7.9%).
The following entities are excluded from the rate increase:
- Securities brokerage companies (SIM);
- Asset management companies for mutual funds;
- Investment companies with variable capital (SICAV) and investment companies with fixed capital;
- Non-financial holding companies (so-called industrial holdings) and similar entities.
Deferral of Negative Components and Limits on the Use of Losses – Art. 1, paragraphs 76–81
Provisions are introduced regarding the determination of the IRES and IRAP tax bases for financial intermediaries. Specifically, tax losses and ACE (Allowance for Corporate Equity) surpluses may reduce taxable income:
- For the tax period ending on 31 December 2026, limited to the additional taxable income for that period resulting from the provisions of Art. 1, paragraphs 14–17 of Law No. 207/2024, up to a maximum of 35% of such additional taxable income;
- For the tax period ending on 31 December 2027, limited to the additional taxable income for that period resulting from the provisions of Art. 1, paragraphs 76–78 of Law No. 199/2025, up to a maximum of 42% of such additional taxable income.
These provisions also apply to entities participating in national and worldwide tax consolidation.
Facilitated Settlement of Tax Collection Liabilities (so-called “Rottamazione Quinquies”) – Art. 1, paragraphs 82 et seq.
The 2026 Budget Law introduces a facilitated settlement of tax collection liabilities (“Rottamazione Quinquies”) for amounts entrusted for collection between 1 January 2000 and 31 December 2023.
The measure allows payment of the principal only, with full cancellation of penalties, interest (including late-payment interest) and collection fees.
Eligible amounts include those arising from automatic settlement and formal checks of tax returns, from LIPE (VAT periodic communications), unpaid INPS contributions, and penalties for violations of the Highway Code imposed by State Administrations.
Access is also granted to taxpayers who defaulted on previous settlement schemes, provided the amounts fall within the defined scope.
Applications must be submitted by 30 April 2026, with the option of payment in a single instalment or in up to 54 bi-monthly instalments.
Temporary Limits on the Deductibility of Interest Expenses – Art. 1, paragraphs 133–136
A new temporary limitation on the deductibility of interest expenses is introduced for financial intermediaries, excluding insurance companies, parent companies of insurance groups, as well as asset management companies (SGR) and securities brokerage firms (SIM).
For the affected entities, the deductibility of interest expenses is recognised on a partial and progressively increasing basis, equal to:
- 96% for the 2026 tax period,
- 97% for 2027,
- 98% for 2028,
- 99% for 2029.
From the 2030 tax period onwards, full deductibility of interest expenses will be reinstated.
Variable Remuneration in the Financial Sector – Art. 1, paragraph 137
A specific exemption is introduced from the obligation to apply the additional 10% IRPEF on variable remuneration paid in the form of bonuses and stock options to executives and directors in the financial sector, as provided under Art. 33 of Decree-Law No. 78/2010.
In particular, the additional tax does not apply where the paying entity (company or institution) makes charitable donations to Third Sector organisations for an amount at least equal to twice the additional tax that would otherwise have been due.
Implementation of this provision will be defined by a measure issued by the Revenue Agency, which will set out the procedures and deadlines.
Substitute Tax for Revaluation of the Tax Cost of Shareholdings – Art. 1, paragraph 144
The rate of the substitute tax for the revaluation of the purchase cost (tax cost) of listed and unlisted shareholdings under Art. 5 of Law No. 448/2001 is further increased from 18% to 21%. The substitute tax on the revaluation of land (agricultural and building plots) under Art. 7 of Law No. 448/2001 remains unchanged at 18%.
Increased Depreciation for Investments in Business Assets (so-called “Hyper-Depreciation”) – Art. 1, paragraphs 427–437
A new hyper-depreciation regime is introduced for business income holders, consisting of an increase, for income tax purposes, in the acquisition cost of eligible assets linked to Industry 4.0 and 5.0 programmes. This increase is relevant exclusively for determining depreciation quotas and financial lease instalments.
The incentive applies to investments made between 1 January 2026 and 30 September 2028 concerning:
- New tangible and intangible business assets classified as 4.0, as identified in the new Annexes to the 2026 Budget Law;
- New tangible assets instrumental to business operations intended for self-production of energy from renewable sources for self-consumption;
- Assets produced in EU Member States or EEA States;
- Assets destined for production facilities located within Italy.
The acquisition cost of eligible assets is increased according to the following rates:
- 180% for investments up to €2.5 million;
- 100% for investments exceeding €2.5 million and up to €10 million;
- 50% for investments exceeding €10 million and up to €20 million.
Access to the benefit is subject to the electronic submission, via a dedicated GSE platform, of specific communications and certifications prepared using standardised templates, attesting to the fulfilment of the objective and subjective requirements of eligible investments.
Tax Credits for the Single Special Economic Zone (ZES) and Simplified Logistics Zones (ZLS) – Art. 1, paragraphs 438–452
The tax credit for the Single Special Economic Zone (ZES unica) is extended for the years 2026, 2027 and 2028, and also applies to assisted areas in the Marche and Umbria regions.
Companies that have validly submitted the additional communication required for access to the incentive to the Revenue Agency between 18 November and 2 December 2025 will be granted an additional contribution, in the form of a tax credit, equal to 14.6189% of the requested credit amount, provided they have not benefited from the Transition 5.0 tax credit under Art. 38 of Decree-Law No. 19/2024 for the same investments.
The application of the tax credit for companies operating in Simplified Logistics Zones (ZLS) is also extended to the years 2026, 2027 and 2028.
Benefits for Energy-Intensive Companies – Art. 1, paragraphs 962–965
Finally, financial benefits are introduced through the establishment of a tax credit, usable exclusively for offsetting, reserved for energy-intensive companies (so-called “energy-intensive enterprises”) included in the lists of companies with high electricity or natural gas consumption, maintained by the Energy and Environmental Services Fund (CSEA). These benefits relate to investments in new tangible and intangible business assets instrumental to operations, as indicated in Annexes A and B of Law No. 232/2016, made in 2025.
The determination of the tax credit follows the rules set out in Article 38, paragraphs 4, 5, 7 and 8 of Decree-Law No. 19/2024 (Transition 5.0).
An interministerial decree will define the criteria and procedures for implementation.
