NON-REPAYABLE GRANT – DECREE LAW NO 41/2021
As of 23 March 2021, Decree-Law No. 41/2021, the so-called “Support Decree” (published in the Official Gazette on 22 March 2021), hereinafter the “Decree”, is in force.
The Decree introduces new aid to companies and self-employed workers in the form of non-repayable grants to partially compensate for any drop in turnover suffered between 2019 and 2020. The government has allocated a total of more than EUR 11 billion for this purpose.
Among the main changes compared to previous similar measures, there are no restrictions on access related to the type of economic activity carried out (ATECO code) and the possibility of using the contribution in the form of a tax credit (i.e. as a credit that can be used as a compensation in F24 to pay other taxes and duties).
At the same time, the Agenzia delle Entrate released the model to be used for submitting the online application.
The application can be submitted from 30 March to 28 May 2021.
Requirements for applying for the contribution
The minimum threshold for access to the contribution remains the same as in the previous measures. Therefore, only entities that have recorded a drop in turnover of at least 30% are entitled to the non-repayable contribution.
The terms of reference for calculating the fall in turnover are the monthly averages for 2019 and 2020. For entities that started their activity after 1 January 2019, please refer to the specific indications given in the last paragraph.
The further threshold provided for by the Decree refers to the total amount of the revenues relating to the second tax period preceding the one in which this Decree comes into force (for “solar” entities, the 2019 revenues). Such amount must not exceed €10 million.
As mentioned in the introduction, there are no limits related to the economic sector of activity of the applicant
Deadlines and technical procedures for obtaining the contribution
The non-repayable contribution can only be obtained by submitting an application to the Italian Revenue Agency on the basis of the model provided for by a directive.
As mentioned in the opening paragraph, applications can be submitted from 30 March until 28 May 2021.
The application can be submitted through the usual telematic channels made available by the Revenue Agency (i.e. the so-called “cassetto fiscale“). The submission can be made directly by a delegated intermediary.
Determination of the amount of the contribution
The amount of the contribution is determined by applying a variable rate depending on the amount of the total revenues recorded by the applicant.
The rates for the calculation of the contribution vary from a maximum of 60 per cent for persons with revenues or fees of less than 100 thousand Euro, to a minimum rate of 20 per cent for persons with revenues between 5 and 10 million Euro:
- 60 per cent for persons with revenues and fees not exceeding €100 thousand;
- 50 per cent for parties with revenues or fees between €100 thousand and €400 thousand;
- 40 per cent for parties with revenues or fees exceeding €400 thousand and up to €1 million;
- 30 per cent for persons with revenues or fees exceeding €1 million and up to €5 million;
- 20 per cent for persons with revenues or fees exceeding €5 million and up to €10 million.
The definition of “revenues or fees” for the calculation set out in the preceding paragraph must be interpreted as a threshold of revenues
For companies and individuals other than natural persons, the minimum contribution is €2,000 and cannot exceed the maximum threshold of €150,000.
Modalities for obtaining the non-repayable contribution
The Decree and the relevant implementing measure of the Inland Revenue, have provided the possibility to obtain the benefit in question in two alternative ways:
- Direct crediting to current account.
- Recognition of a tax credit to be used as compensation.
The choice between the two methods, expressed by means of the online application, is irrevocable. This is without prejudice to the possibility of waiving the entire contribution (which must also be done by means of the online application).
The tax credit referred to in option 2), can be used as a means of payment of other taxes and duties (pursuant to Article 17 of Legislative Decree 241/1997). The offsetting is carried out by means of telematic F24 form.
By express provision of the law, the contribution in question is not subject to the quantitative limits provided for the so-called horizontal compensation (i.e. between different taxes), such as, for example, the maximum threshold of 750 thousand Euros per year for the compensation of tax credits (exceptionally threshold of 1 million for 2020).
Provisions for persons who have started their activity since 2019
The Decree does not preclude access to the contribution for persons who have recently started their activities (provided that they started before the entry into force of the Decree, i.e. 23 March 2021).
For persons who started their business on or after 1 January 2019, the contribution can be determined as follows:
- if the difference between the average monthly amount of the turnover and fees of the year 2020 and the average monthly amount of the turnover and fees of the year 2019 is negative (i.e. the figure for 2020 is at least 30% lower than the figure for 2019), the contribution is determined by applying to the aforementioned difference the percentage of 60, 50, 40, 30 or 20 per cent depending on the amount of the revenues or fees declared in 2019 (without prejudice to the recognition of the minimum contribution referred to in the next point, if higher);
- if, on the other hand, the aforementioned difference is negative but less than 30%, positive or equal to zero, the contribution is equal to the minimum of €2,000 for persons other than individuals.
LDP stays at your disposal for any further clarifications.