20% witholding tax on transfers from outside Italy

First topic message reminder :

From 1st February 2014 ALL transfers to Italian bank accounts from outside Italy will be subject to a 20% witholding tax. For example if you receive €100, the bank will deduct €20 and send it to the Italian tax office on your behalf. This is to do with the tax due on investments abroad. To reclaim the money, assuming it was not the result of an investment abroad, you must reclaim it on your next Italian tax return.

There is some light at the end of the tunnel - you can make an 'autodichiarazione' at your bank regarding the 'ritenute d'ingresso' to declare it is not money from investments abroad and the bank will no longer deduct the 20%.

I suspect but do not know for sure, that the 'dichiarazione' must be made annually.

Some banks have said that despite the 1/2/2014 it will take a little longer to implement.

Pensions (private - company) are classed as "earned" income according the link I posted HERE... and therefore should not come under this taxation, but obviously you need to complete the form (if they have them yet)....    

Ha Ha Steve, Banca Marche in Gualdo knew nothing about it and had to ring their head office for more info.  They were told, in true Italian style the forms should be available in June but of course they would backdate to  Feb all monies owing....Great !

I thought UK's taxes were harsh but automatically out of your bank account?

That's illegal here. I am pretty sure.

I emailed my bank today and they emailed me back a form to sign and return. Hopefully it will be that straight forward.

I suppose the simplest answer to this, would be just to pay a UK cheque into the bank, unless that will be taxed as well. Ok you would have to pay a commission charge, but it is not a direct interbank transfer. Any thoughts on that idea??

Thanks Tinca. Would suggest others try to get a copy from somewhere... Anyone finding a link to such, could they post the link...

The form my bank emailed me had all my account details pre-printed on the form. I don't know if each bank has their own form. I'm with BCC in Comunanza.

I'd be interested to see when the first actual cash grab is on this one ! I have yet to see a form to fill in ! Does the bank just take 20% out every month until the form arrives?      Google translate at the bottom.

V


Tuttavia, i primi versamenti all'erario da parte degli intermediari (principalmente le banche) andranno effettuati il 16 luglio, conguagliando in quel versamento tutte le ritenute maturate dall'1 febbraio fino al 30 giugno (e quindi accantonate e con gli interessi). Successivamente, si verserà la trattenuta ogni 16 del mese successivo all'effettiva percezione della somma. Di fatto, a tutti i contribuenti che riceveranno un bonifico dall'estero sul proprio conto personale - e non professionale o d'impresa - sarà applicata la ritenuta, a titolo di acconto che sarà, poi, scomputata in sede di dichiarazione annuale dei redditi.







However, the first payments to the Treasury by intermediaries (mainly banks) will be performed July 16, conguagliando in that all the deemed payment accrued from February 1 until June 30 (and therefore set aside and with interest). Next, you will pay the withholding every 16th of the month following the effective perception of the sum. In fact, all taxpayers who receive a transfer from abroad on their personal account - and not professional or business - will be applied to the deduction, as an advance which will then scomputata in the annual tax return. 

Thank V. Looks to me they are going to take the monies at any point between the 1st Feb 14 and 16th July when payments will be first due... I'm guessing the "interest" is tax on any earned and not interest on the late paid 20%... Until the forms become available and we KNOW the bank has ours we will be using a top-up card and visiting the ATMs a lot... Caxton and FairFX look to be our best option. Think it will likely be getting on for 9-12 months before we move money over again... I sure it will al change again by then!

Help !  I am extremely worried about this 20% tax imposition.  Our only income is from my husbands UK govt pension and and his works pension.  Both are small lss than £500 each per month.  We have an Italian mortgage of approx 500 euros a month. This is paid from the 'works' pension which is paid by bank transfer to our Banca Marche account.  If this is subject to the 20% tax the mortgage will not be paid and as a consequence our house will be repossessed.  Banca Marche, Gualdo, have not yet received instructions for dealing with the situation, and there are no 'auto-declaration forms' available at the moment.  If this tax is to be backdated to Feb 1st we will not be able to pay it.  Where does this leave us ?  What should we do ?  Heads and a gas oven leap to mind !  Any advice much appreciated.

The price of gas nowadays.................I would not go down that route !!   

But... much more seriously, I would wait and see, don't forget that you can self declare as soon as you are able. I think Banca Marche has a responsibilty to it's customers to get themselves sorted. One can also claim it back, it does seem crackers to me !

piano piano !

V

Geotherm - the legislation includes cheques I'm afraid.

There is a petition to abolish this ridiculous law: abolish this unfair law

Here is an example of an autodichiarazione: autodichiarazione

which states your income comes from dependent work abroad. Obviously you would need to state what your income is from by replacing the section "sono frutto esclusivo di attività di lavoro dipendente prestato all’estero. Si chiede pertanto che su detti redditi".

For a pensioner this might read "sono solo le rendite pensionistiche dall'estero. Si chiede pertanto che sulle rendite sopracitato rendite". Please correct my Italian those of you better at it :-)


If your bank says it doesn't have one or 'don't worry', I would fill in the one above and send it recorded delivery with receipt to your bank. Everthing I have read says they will not apply the deductions until July but will backdate them. Better to be safe than sorry.

Interestingly the Consumer's assocations are threatening legal action as they believe the law is unconstitutional and against EU free trade and free movement of money rules. Watch this space.

I also read this today which is what I suspect it is all about: Qualora si dichiari che tale somma non è da assoggettare a ritenuta, la banca segnalerà all'Agenzia delle Entrate l'operazione e il tuo nominativo. Which basically means that if you fill out the autodichiarazione the bank will report the transfer and your details to the Agenzia delle Entrate - presumably to check up on you later.

Oh well, another 3rd world country. Do they not think everyone will find ways round this, by using ATM's, or bringing the money in by cash from abroad.
Communism comes to mind .......... "whats yours is ours and you must pay to keep our leaders in the lifestyle they require.
Getting to be more reason for getting out of this pathetic, corrupt country

SUPERB info folks, thanks !!

This could just be a step too far for us.................I went and withdrew cash from an ATM today using my UK debit card just to see the effect of it.

We spend 'lots' of my well earned pension (UK gov) pension here in Italy and it hopefully helps the economy here, but for the first time I am thinking 'why'? !

I don't mind jumping over hurdles, but at my time of life I don't fancy (or feel like) steeplechasing!

Thanks again for the info,

V  

Geotherm wrote:Getting to be more reason for getting out of this pathetic, corrupt country

Geo,

I agree, thinking about withdrawing ourselves, one can push too far ! I don't need it, don't want it and don't have to put up with it. We all have our choices ! We will give due consideration to next steps.

We LOVE so much about what we have here, but you have to wonder where this place is going to be in 5 years time !

V

PS: I can't believe this can be legal !

I must admit, that I started to realise how money grabbing this country is within a year or so of buying here.
Examples, we bought a waste disposal unit for the kitchen sink, from the same supplier in the town of the sink. Problem!! unit was not the same size as sink outlet. OK we say, get the right size outlet, as it is available, as we have checked with the supplier. Month later, big excuse that supplier has not answered, will try again. 2 months later still no answer. Just said to him OK you cannot supply so you can have it back as a E600 unit is no good to us. Response: I cannot refund you the 20% IVA you have paid me, as I have already paid it to the tax office, but good news is the supplier will take the unit back, so I have not lost out, paying you back.
Wills: We were quoted if I remember correctiy, some years ago, that the standard cost for a lawyer to write up a will here was a % of the property value, as a standard practice. Cannot remember what it was, but it was a ludicrous figure.

Here is a LINK from the Abruzzolutely forum with another example of the form you need. Perhaps it would pay to even draft up your own and send it to your bank....

My bank, BNL, seems to be on top of it. I got this letter last week and, if I understand it correctly, it recognizes that we are not resident, and that we are ourselves responsible for paying our taxes.

"Ove non residente, il cliente dichiara e prende atto che qualsiasi adempimento richiesto dalla normativa fiscale, comunque connesso all'esecuzione del presente contratto, che la normativa stessa non attribuisca in via diretta alla banca, sará da me direttamente svolto nel pieno rispetto di quanto da essa stabilito, con esonero pertanto della banca da ogni e qualsiasi responsabilita al riguardo."

Geotherm, I have found since leaving Marche and moving to a supposedly more expensive part of Italy (and some things like retaurants definitely are) that much of the charging practices in Marche are a complete rip off. So I don't think it is right to tar the whole of Italy with the same brush (taxman excluded). Overcharging ridiculously seems to be particularly prevalent in Marche.

I have also suspected for a while (just from little things I've read) that Marche is at risk of "killing the golden goose"! I suspect some are cashing in on unsuspecting immigrants like us and ripping them off. Word soon gets around on things like that, which could leave the area wide open. Just hoping Abruzzo does not go the same way as there have been rumblings here also, but for us most of the people have simply been helpful...

There is one unscrupulous estate agent in our area of northern Tuscany but otherwise all the Italians we've met or employed have been delightful, friendly and honest.

I wasn't necessarily saying it is only aimed at foreigners. It happens to Iyalians too.

Admin - what things in Marche do you think are rip offs. Forewarned is forearmed!