This blog was last updated on January 11, 2024
New cells in Italy’s annual IPT return
Update: 8 June 2023 by Edit Buliczka
On 31 March the Italian tax authority released a new Insurance Premium Tax (IPT) return form. The Italian IPT return is an annual return due by 31 May in the year following the reporting period. Related payments are due on a monthly basis and there is a prepayment obligation.
The IPT return template was previously changed in 2019.
The most recent update introduces two additional cells to the AC section. This section lists the total amount of taxes payable and any payments or credits that might reduce them. The two new cells are the AC5 column 1 and AC5A. In addition, column 2 of AC5’s description is now clearer.
AC5 column 1 must indicate the amount of the unused prepayment that remains after the deduction of any monthly payments.
By including the statement that this cell should be populated with the prepayment amount made via F24, AC5 column 2 is clearer.
The new row, numbered as AC5A on the return form should include the excess of the prepayment placed into AC5 column 1, in the return submitted for the previous year.
The new return template was already applicable for the 2022 annual IPT return which was by 31 May 2023. Because AC5 column 1 is a new addition to the return, the AC5A cell should have been left blank on the 2022 return.
This new Italian IPT annual return form is very much appreciated by Sovos since, in our opinion, it will make prepayment settlements show much more clearly than they did in the previous return.
If you want more information about Italy’s annual IPT return or have a query, get in touch with our insurance premium tax specialists.
Italy Insurance Premium Tax Registrations and Filing
Update: 22 October 2020 by Hellen Msangya
As an insurer authorised to write business in Italy, IVASS (Italian Insurers Supervisory Board) have provided you with the appropriate insurance certificate but what else is needed and what happens next?
This is just the start of a lengthy and at times demanding journey towards insurance premium tax (IPT) compliance. At the outset, the insurer must register with the Agenzia delle Entrate, the Italian tax authority; attain a fiscal code for the purposes of tax settlement and subsequent return submission; appoint a legal representative, a competent individual with proven professionalism and decision-making capabilities within your firm; and perhaps the most fundamental step, to appoint a fiscal representative to act on your behalf. These are the main legal requirements towards achieving compliance, but it’s just the start. All the above requirements are dependent on each other and in most cases, are connected.
But how can an insurer reach these milestones?
Registration
Firstly, there are decisions to make and specific steps to follow when registering with the Agenzia delle Entrate. These decisions depend on numerous variables such as:
- The insurer’s authorisation structure which may affect the number of registrations required and consequently the number of and costs related to filings
- Who to appoint as legal representative which has ramifications for registrations, reclaims and deregistration
- Who to nominate as fiscal representative depending on the scope of services offered, the scale of the business and the level of compliance needed
- The classes of business being written where for some there will be additional registrations and contributions required such as to CONSAP
- The location of risk within Italy where additional contributions, provincial taxes and filings will be due.
Let’s not also forget Brexit. This has affected and continues to affect both established and establishing UK insurers where most have faced some form of reorganisation. Most common reorganisations have been for portfolio transfers, mergers, and new companies formed in the European continent to enable them to continue with their operations. These changes have inevitably changed the filing for many entities.
Filing Process – a busy year
Post-registration, regardless of the regime under which an insurer operates in Italy, there are constant filing and tax settlement requirements all through the year, even more so for domestic insurers. Each month, all insurers must pay both IPT and parafiscal charges relative to premiums received in the previous calendar month. In January each year, a provisional payment and declaration is due towards CONSAP for the Road and Hunting Accidents Victims Funds. February brings a requirement to file the Contracts and Premiums Report due at the end of the month. In April, Claims Reports are due, while the IPT annual return for the previous year is due at the end of May. For the month of June, IVASS requires a detailed report relative to the distribution and intermediary channels, a requirement started this year with the first report being relative to the year 2019. In September, an adjustment to the January provisional filing and payment is made to CONSAP relative to the aforementioned funds.
By 16 November, the IPT prepayment relative to the following year is due. This is a legal requirement for all insurers registered at the time the payable amount is due. This advance payment is a retrospective liability as it’s based on the taxes paid for the previous calendar year and is due with few exceptions from all insurers who are registered on the date by which it’s due. Publications by the Agenzia delle Entrate are currently in circulation outlining the exceptional rulings made by the Italian Supreme Court of Cassation as guidance for the exceptional cases, the most recent of which is relative to the reorganisation of a company following Brexit.
The final key item to note is that there is no uniform filing system or channel for all the requirements due from insurers in Italy. A deep knowledge, expertise and experience are required for the requirements to be met and to remain compliant with the Italian regulations. Insurers need to have measures in place and make complex decisions to remain on top of the ongoing changes to regulations made by the Italian tax authorities and the Insurers Supervisory Board.
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