Get support from A&P

Expense reimbursement for the purchase of laptops and tablets: when it does not constitute employment income

The Revenue Agency has provided some clarification on the possibility of employers to reimburse expenses for the purchase of laptops/tablets for 'transferred employees'.

Table of Contents

We are based in Italy

Chartered Tax Advisors

Quality ISO 9001 Certified

The Revenue Agency, with its reply No. 294 of 24th of May 2022, clarified that the reimbursement by the employer of expenses incurred by employees falling into the category of “transferred employees” for the purchase of laptops/tablets does not constitute employment income within the meaning of Article 51, cv. 2, lett. f-bis) of the TUIR.

Article 51 of the TUIR and the “all-inclusiveness principle”

According to Article 51 c.1 of the Income Tax Act, “all sums and values in general, for whatever reason, received during the tax period, including in the form of liberal donations, in connection with the employment relationship” constitute employee income.

The aforementioned provision enshrines the so-called principle of all-inclusiveness in the concept of taxable employment income, whereby both cash emoluments and values corresponding to goods, services and works offered by the employer to its employees, or by third parties, constitute taxable income and, as such, are included in the determination of employment income.

Exception to the principle

The same Article 51 identifies, however, specific exceptions to the aforesaid principle, listing the income components that do not contribute to forming the taxable base or contribute to it only in part. In particular, paragraph 2 provides that the following do not contribute to forming the employee’s income:

the use of works and services recognised by the employer voluntarily or in accordance with contractual provisions or company agreements or regulations, offered to the generality of employees or to categories of employees and family members indicated in Article 12 for the purposes referred to in Article 100 c.1” [Article 51 c.2 letter f. of the Income Tax Act];

the sums, services and benefits provided by the employer to all employees or categories of employees for the use, by the family members indicated in Article 12, of education and instruction services, including pre-school education, including supplementary services and canteen services related thereto, as well as for the attendance of playgrounds and summer and winter centres and for scholarships in favour of the same family members” [Article 51 c.2 letter f-bis) of the Income Tax Act].

In Resolution No. 37/E of 27 May 2021, it was clarified that the reimbursement paid by the employer for the expenses incurred by the employee for the purchase of PCs, laptops and tablets as necessary tools, provided for by school regulations, for the use of education and instruction services, or to ensure attendance in the so-called “virtual classroom” and, consequently, the relationship between teachers and learners, does not contribute to employee income.

With regard to the category of employees, as specified in Resolution No. 378 December 2007, it also includes “expatriates” or “assignees”. By analogy, therefore, the ‘transferred employees’ in the present case must also be included in this category.

The position taken by the Revenue Agency in its reply 294 of 24 May 2022

In light of the regulatory and practical framework outlined, the Agency has therefore deemed that the reimbursement by the requesting employer of expenses incurred by employees who fall into the category of ‘transferred employees’, for the purchase of laptops/tablets does not constitute employment income. Similarly, the reimbursement of any registration fee for the school entrance test will also be excluded from income.

For further info on the category of “transferred employees”, you might be interested in reply no. 740 of the Revenue Agency, which approved the electronic procedure developed by a company for the creation, control, accounting, and fully digitalized preservation of expense reports produced by the transferor employees.

Get a Free Quote

Regulatory Framework

Reply No. 294 of 24th of May 2022

Reference (Italian only)

Don't miss out on the latest updates

Get free updates from our Experts on Immigration, Posting Workers, International Taxation and more.