The instructions on the incremental flat tax are ready: in the Revenue Agency circular no. 18/E of 28 June 2023 all the news on the substitute tax introduced for the current tax year on income increases. Excluding new beneficiaries of the flat-rate scheme
Clear instructions for the flat tax incrementale: with the circular no. 18/E of 28 June 2023 the Revenue Agency provides the indications for the application of the flat tax of 15 percent.
Introduced by the latest Budget Law exclusively for the current tax period, the flat tax in lieu of IRPEF for VAT holders it will be applied on the income increases recorded compared to the highest income declared in the years from 2020 to 2022.
Once the public consultation phase has been concluded, the operational indications for access to the transitional tax regime. They stay excluded VAT registered holders flat-rate scheme in 2023.
Incremental flat tax, instructions and news in the Revenue Agency circular
After the public consultation phase, the circular no. 18/E published by the Revenue Agency on 28 June 2023 confirms the scope of application of the new flat tax of 15 percent, introduced on a transitional basis for the current tax period.
The incremental flat tax is the optional regime in lieu of IRPEF and surtaxes which provides for the application of a fixed rate of 15 per cent on the difference between the income determined in 2023 and the one with the highest amount relating to years from 2020 to 2022. The goal is encourage income increaseswith the application of a reduced and more convenient taxation.
Few additions have been made to the draft document published on 6 June. The definitive circular confirms that natural persons who carry out business, arts and professions are eligible to benefit from the incremental flat tax for 2023.
Flat tax on income increases may apply also from the family business and from the conjugal business not managed in corporate form, in relation to the owner’s income.
Compared to the first version of the circular, the Revenue Agency also includes in the scope of VAT registered beneficiaries of the facilitated regime individual farmers who access the regime referred to in articles 56, paragraph 5 and 56-bis of the TUIR, limited to the business income produced.
Incremental flat tax, the Revenue Agency circular no. 18/E of 28 June 2023
Download the circular of the Revenue Agency with the indications for the application of the flat tax of 15 percent
Incremental flat tax also to flat rates from 2020 to 2022
Then defined the audience of beneficiaries of the incremental flat tax, the Revenue Agency focuses on those excluded. No flat tax for the income of partnerships, charged to the shareholders for “transparency” and those deriving from the exercise of arts and professions in associated form, charged to individuals.
No incremental flat tax even for VAT holders who will access the flat-rate regime for 2023. But on this point the circular specifies that the possibility of applying the substitute tax also concerns who joined the flat rate from 2020 to 2022in one or more years, or the benefit scheme.
Some are also provided in the circular examples for calculating the tax base on which to apply the flat tax of 15 per cent.
It will be necessary to consider the difference between the income determined for 2023 and that of the highest amount for the period from 2020 to 2022, and on this amount apply the 5 percent deductiblecalculated on the highest income of the monitored three-year period.
On the amount thus calculated, up to a maximum of 40,000 euros, it will therefore be necessary to apply the fixed rate of 15 per cent. In case of excess income increases however, this threshold will continue to applyordinary IRPEF taxation.