Legislative Decree no. 13 from 12 February 2024, with the aim of reinforcing cooperative compliance institutions, has established the Biennial Preventive Agreement (BPA) through which, upon the reaching of an agreement between the Italian Tax Agency and an individual tax payer, the latter shall be able to determine, for a two-year period, the income which derives from the exercise of its business or from that of trade and business-related to income tax and IRAP (regional tax on productive activities) purposes. The new institution does not, however, impact current VAT regulations.
Once the proposal is accepted, the taxpayer shall determine its tax burden, as well as its social security taxation, based on the previously agreed-upon amounts; in general, any actual income which proves to be higher or lower compared to the previously agreed-upon amounts shall not be relevant for IRPEF/IRES, IRAP and social security taxation purposes.
Taxpayers who may achieve access to the BPA are those who carry out business, trade or professional activities that apply the Summary Reliability Indices (SRI) and who adhere to the flat-rate regime.
Requirements for taxpayers seeking to take part in the BPA are:
- absence of tax debts in the period leading up to when the proposal is placed;
- routine submission of tax return;
- absence of a conviction for tax crime, for false corporate communications, for money laundering or for illicit use of money or assets, as well self-instigated money laundering.
The perks for those adhering to the BPA include exclusion from verifications regarding correctness and correspondence of accounting records as well as access to rewards from the SRI regime, namely:
- exemption from the stamp of approval for the compensation of credits dealing with amounts not exceeding €70,000 for VAT and €50,000 for direct taxes and IRAP;
- exclusion from the application for the discipline of non-operating companies (art. 30, L. 724/1994);
- exclusion from assessments based on simple assumptions;
- the advance in the deadline by at least one year for assessment activity;
- exclusion from essential determination of aggregate income provided that the ascertainable income does not exceed two thirds of the declared amount.
Upon the end of the two-year period covered by the agreement, assuming the taxpayer continues to respect the necessary requirements to gain access the BPA, the Internal Tax Agency may formulate a new agreement proposal dealing with the ensuing two-year period, which the taxpayer may once again adhere to.
