Institutions Exempt from Industrial, Commercial and Non-Commercial Profits Tax
- Institutions exempt from tax on industrial, commercial and non-commercial profits include, but are not limited to: universities, hospitals owned by non-profit associations, schools, public-benefit institutions, and similar entities.
- Institutions temporarily exempt from income tax on profits, such as industrial institutions granted exemption under specific conditions.
- All individuals and legal entities benefiting from exemptions or special exceptions from income tax, as well as all companies benefiting from a permanent exemption pursuant to Article 5 of Legislative Decree No. 144 dated 12/6/1959, must submit annual declarations and statements to the competent financial departments.
- Capital companies or partnerships must use their respective income tax declaration form, “C1” or “A1”, even if they are exempt from tax, whether the exemption is temporary or permanent. This excludes banks, financial institutions, insurance and reinsurance companies, and holding companies, each of which has its own specific declaration form.
- Individual establishments taxed on the real profit basis must use income tax declaration form “F2”, even if they are exempt from tax.
- Institutions exempt from income tax other than companies must file using form “J”. These include, but are not limited to: charitable associations, cooperative associations, property owners’ associations, sports clubs, federations, syndicates, representative offices, and similar entities.
The deadline for submitting declarations is as follows:
- Before or at the time of payment for institutions that use cash-basis accounting.
- Before or during April for institutions that use accrual-basis accounting, and for representative offices representing partnerships.
- Before the first of June for representative offices representing capital companies.
- Salaries and wages paid to employees of all institutions exempt from industrial, commercial and non-commercial profits tax are subject to salaries and wages tax, and the related tax obligations fall on these institutions as employers.
- Amounts paid to non-residents by all institutions exempt from industrial, commercial and non-commercial profits tax are subject to income tax, and the related tax obligations fall on these institutions as employers.