Effective as of 24 October 2016, Italy has reopened its voluntary disclosure (“VD”) program.
The VD program is mainly addressed to taxpayers who:
- on or prior to 30 September 2016, were resident, for tax purposes, in Italy and did not comply with the Italian exchange control regulations;
- have not already benefited from the VD program's first edition;
- have not already had formal knowledge of the commencement of any actions by the tax administration leading to a possible tax assessment (such as an on-site audit, request for documents or information, etc.) or the commencement of a criminal procedure for violations of tax provisions connected to the subject of the disclosure.
The VD program will enable such taxpayers to come forward and declare wealth held outside of Italy in violation of Italian exchange control regulations, in return for substantial concessions over monetary penalties and relief from prosecution for the main tax and money-laundering crimes the taxpayers may have committed in relation to the assets held abroad.
Participation in the program requires full disclosure of the taxpayers' identity and all their assets and investments abroad as well as the payment of the full amount of previously unpaid taxes and related interest.
Taxpayers are not allowed to file more than one voluntary disclosure request.
Please note specific rules have been set forth in relation to cash or other bearer instruments not held with a financial intermediary and irrespective of whether such types of assets have been located within or outside the Italian territory. Indeed, in such case the effectiveness of the VD program is subject to:
- a self-declaration by the taxpayers in which he/she states that such assets do not originate from crimes which are not among those crimes whose penalty is excluded by the VD;
- the presence of a notary public at the time of opening of the safe box, if the assets are stored in a safe box; and
- such assets are transferred to an authorized intermediary and kept in an escrow account until the VD procedure is finalized.
Application to the VD program must be filed by 31 July 2017, while the VD report and supporting documentation must be filed by and the taxpayer-calculated payment must be made by 30 September 2017.