Italy: Intermediate holding companies in private equity structures served genuine, non-tax purpose (court decisions)
Based on the retroactive application of the EU fund exemption rule on dividends and capital gains
Intermediate holding companies in private equity structures served genuine non-tax purpose
The First Degree Court of Rome held in two recent cases (nos. 11354 and 11355) that intermediate holding companies in private equity structures served a genuine, non-tax purpose and could not be considered as mere conduit entities because their use does not bring any tax benefit.
The courts’ decisions were based on the retroactive application of the EU fund exemption rule on dividends and capital gains, formally introduced from 1 January 2021 by the Finance Bill for that year.
KPMG observation
It remains to be seen if these decisions will be appealed by the tax authority and how any such appeals to higher courts (i.e., Second Degree Tax Court and, possibly, the Italian Supreme Court) may be decided.
Read a November 2022 report [PDF 305 KB] prepared by the KPMG member firm in Italy
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