Through sentence n. 36016 of 27th December 2023, the fifth Section of the Court of Cassation has provided clarifications in relation to the fiscal benefits provided by Law n. 238/2010 – on fiscal incentives for Italian workers returning to Italy, in force until 2017.
In particular, to take advantage of these benefits, the requirement of residence abroad for study or working activity must have a duration of at least 24 months.
What the regime provided for (Law n. 238/2010)
The special regime established by Law n. 238/2010 (not in force anymore) provided for fiscal incentives in the form of a partial taxability of the income deriving from employment, self-employment or business activities started in Italy.
Beneficiaries of the regime
The regime was addressed to EU citizens holding a degree, who had continuously carried out an employment, self-employment or business activity outside Italy and their country of origin.
Moreover, the benefits were in favour of EU citizens who had carried out a study activity to obtain a degree or a post-graduate specialisation.
The beneficiaries of such incentives are referred to as “contro-esodati”, since the law was addressed to Italian and EU citizens who, after having resided continuously in Italy for at least 24 months, then trasferring their residence abroad, had decided to return to Italy.
The categories of beneficiaries had been identified through the Ministerial Decree of 03/06/2011. In summary, the subject displaying the requirements provided for in the Revenue Agency’s Circular n. 17 of 23/05/2017, Part II, § 2.1 could benefit from the regime.
The applicant’s case
The case had started from an IRPEF refund application, related to the fiscal benefits provided by Law n. 238/2010 and submitted by a taxpayer. The financial administration had rejected the application, due to the lack of the 2-year requirement of residence abroad for study or work reasons.
Then, the applicant had appealed before the competent Tax Court of First Instance, which had dismissed the appeal.
Following the applicant’s appeal in front of the Court of Second Instance, the judges had recognised the applicant’s right to receive the IRPEF refund, related to the fiscal benefits provided by Law n. 238/2010.
The Court of Cassation’s judgement
The financial administration appealed before the Court of Cassation, which provided its definite judgement on the case. The Cassation allowed the Agency’s appeal, thus overruling the decision of the Tax Court of Second Instance, which was in favour of the taxpayer.
The Supreme Court clarified that the law on the tax relief covers two separate cases:
- Individuals with a significant work experience, whose eligibility is assumed if prolonged for at least 24 months. Thus, the absence of such experience does not allow access to the fiscal benefits.
- Individuals who have resided abroad for two years to obtain an academic qualification. In this sense, Circular n. 14/2012 of the Italian Revenue Agency specifies that the study requirement must be assessed separately. Moreover, such requirement is met by those who completed a course of study of at least two academic years.
Thus, the Court of Cassation has clarified that the sole study requirement is not sufficient to obtain the fiscal benefits. At the same time, the judges also point out that the sum of two different study experiences is not deemed sufficient, since each study activity does not meet the necessary minimum time requirement.
Therefore, in addition to the obtainment of the qualification, two years of residence abroad are required to access the benefits. Such time is calculated as two calendar years – 24 months – since no interpretation of the law deems the exclusive reference to academic years sufficient.