Longer tax assessment times under Italy’s 2016 Stability Law

The 2016 Stability Law outlines new time limits for the tax assessment period and new rules relating to mandatory checks by the Italian tax authorities.

The Stability Law (approved by Law No. 208 on 28 December 2015) provides new time limits for the forfeiture of the tax assessment period and new rules relating to mandatory checks by the tax authorities.

From 31 December 2016, the ordinary terms for notification of the notices of income and VAT tax assessment are extended by one or two years; depending on whether the taxpayer has filed his/her tax return or not, repealing the mechanism of doubling of the terms in the event of a fiscal offence.

The new rule

The provision contained precisely in the Stability Law, in paragraphs 129 to 132 of Art. 1, intervened in particular on the following articles:

  • Art. 43 of Presidential Decree of 29 September 1973, No. 600: the assessment notices for income purposes shall be notified, under penalty of forfeiture, by 31 December of the fifth year following the year in which the tax return was filed (provision thus amended by Art. 1 of Law No. 208/2015; previously, the notification could be served by 31 December of the following fourth year).

In cases of failure to file a tax return or in the event of filing of a void tax return, in accordance with the provisions of Title I of Presidential Decree No. 600/1973, the assessment notice may be served until 31 December of the seventh year following the one in which the tax return should have been filed (previously, by 31 December of the following fifth year).

  • Art. 57 of Presidential Decree of 26 October 1972, No. 633: notices relating to VAT adjustments and assessments must be served, under penalty of forfeiture, by 31 December of the fifth year following the year in which the tax return was filed (previously by 31 December of the following fourth year).

Where the tax return is not filed, the tax assessment notice may be served until 31 December of the seventh year following the year in which the tax return should have been filed (previously, by 31 December of the following fifth year).

In the event of a request for refund of excess tax, if more than 15 days have elapsed from the date of notification of the request for documentation from the Tax Office, the deadline to submit the documentation requested is extended by a period of time equal to that included between the 16th day and the date of actual delivery of the documentation.

Conclusion

Starting from fiscal year 2016, the ordinary terms for assessment for income and VAT tax purposes have been extended by one year, or two years in the event of failure to file a tax return. Conversely, for the past, the rules provided for by Legislative Decree No. 128/2015 in force until the returns (Modello UNICO form 2016) regarding the 2015 tax period will instead apply, with the application of the doubling of the terms in the event of breach pursuant to Article 331 of the Italian Code of Criminal Procedure.

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