For some years now, the Italian and Swiss tax authorities have been actively collaborating by exchanging information on financial positions held by specific taxpayers in Switzerland.
This form of cooperation is closely related to the lack of Italian taxpayers, who held financial assets in Switzerland, to adhere to the voluntary disclosure procedure, which allowed them to voluntarily regularise their position with the Italian tax authorities by paying the taxes due for reduced penalties and generalised criminal coverage for tax crimes related to tax violations.
Cooperation between Italy and Switzerland
The first step towards cooperation dates back to 23.02.2015 with the signing of the Protocol amending the Double Taxation Convention in force between the two States (DTA), ratified by Law No. 69/2016, and a roadmap signed at the same time on tax and financial issues.
Thus, in the first instance, the two States adopted the exchange of information upon request, since the roadmap provided for the possibility for the Inland Revenue to submit to the Swiss authorities the so-called "group" requests relating to particular taxpayers who, between the date of signature of the Protocol (23.02.2015) and the entry into force of the automatic exchange of information (1.1.2017), had engaged in "obstructive" behaviour towards the Italian tax authorities with regard to their current accounts held abroad.
In order to implement the above mentioned international agreements, on March 2, 2017, the Federal Tax Administration (FTA) and the MEF entered into a further agreement regulating the operating procedures for grouped requests.
Last call for "recalcitrant" taxpayers
Following this, the Agenzia delle Entrate (Revenue Agency) has sent several group requests to the Swiss Authority concerning the accounts held by Italian residents at Swiss banks from 23.2.2015 to 31.12.2016 (prior to the entry into force of the automatic exchange). The addressees of these requests for information are the so-called "recalcitrant" taxpayers, i.e. those who, in order to circumvent or avoid the future automatic exchange of information, closed their current accounts held with Swiss banks during this reference period, perhaps even carrying out international transactions by means of outgoing transfers for the purpose of disposing of the Swiss banking relationship.
Although the voluntary procedure was adopted by the majority of taxpayers, many Italian residents have received letters from their bank (from UBS to BSI, but in general, almost all Swiss intermediaries) inviting them to give their consent to communicate their personal data as well as those relating to the Swiss current account directly to the Italian tax authorities.
In this communication, the financial institution outlines to the taxpayer the various steps to follow in order to participate in the Swiss information assistance process. In particular, the natural person resident in Italy and holder of the "suspect" account should have notified his or her address in Switzerland and signed the authorization to transmit his or her data to the Revenue Agency through the FTA; if he or she did not adhere to the procedure, the FTA would have issued a decision on the taxpayer's position, which could be challenged before the FAC (Federal Administrative Court).
Therefore, the most frequent cases that the group request intends to affect concern those taxpayers who did not adhere to the voluntary disclosure and closed their Swiss current accounts after 23.2.2015, as well as those who - frightened by the requests sent to other Italian clients in their own conditions as well as by a future automatic exchange of information - decided to move their residence to Switzerland in 2015.
Possible and final remedies to regularise the position with Italy
If the taxpayer holding the financial assets in Switzerland has not yet regularised his tax position, he may have one last chance: the industrious repentance.
In fact, with the diligent repentance pursuant to art. 13 of Legislative Decree no. 472 of 1997, it is possible to remedy one's own tax irregularities by spontaneously making payment of the taxes due, of the interest calculated at the legal annual rate, in addition to the penalties provided for in a reduced amount (depending on the time actually elapsed from the expiry of the ordinary deadline for compliance).
However, the taxpayer must make himself aware of the access, inspections and verifications and before the Italian tax authorities have notified him of any notices of assessment.
Since this is the last chance for taxpayers who intend to make up for their "forgetfulness" with the tax agent, the industrious repentance is still an advisable procedure as it is very risky to delay further in the hope that the Revenue Agency will not act on the tax periods that are still ascertainable.
The anomalies
On this issue, there is a significant anomaly: although Switzerland has taken important steps in terms of fiscal transparency so as to be included in the Ministerial Decree of 9.8.2016 among the white list countries that adopt the exchange of information with Italy, it is not clear why this country is still on the list of countries with privileged taxation issued by the Ministerial Decree of 4 May 1999. The direct consequence of this circumstance is that there will always be 10 tax periods to be "remedied" and not 5. Most probably, the anomaly just mentioned has a substantial justification: in fact, if the doubling of the deadlines did not take place, intransigent and less cooperative taxpayers would risk having an advantage precisely for having tried, up to the last, to avoid Italian taxation.
Last but not least, it should be noted that, in terms of criminal punishment, the institute of active repentance, contrary to voluntary, does not provide for extensive criminal coverage when tax violations result in the existence of tax offences. For example, if the taxpayer who has been found guilty of the offences of money laundering and self-laundering were to be challenged, the taxpayer would not be able to benefit from protection through active repentance that would exclude his punishability for the offences in question.
If, however, the violations carried out by the taxpayer with regard to financial assets held abroad were to lead to the realization of the conditions of the unfaithful declaration, then the active repentance could lead to non-punishability. In fact, Article 13, paragraph 2 of Legislative Decree 74/2000 provides that a taxpayer who, within the deadline for the submission of the subsequent declaration, makes an active repentance is not punishable for the crime of unfaithful declaration.
Fidinam Italia
That being said, thanks to its experts, Fidinam Italia is able to provide adequate tax advice aimed at assisting taxpayers in the process of active repentance.
More in detail, the Company would provide assistance for the entire procedure of regularization of the amounts held abroad, through the preparation of appropriate declarations aimed at remedying previous declaratory infidelities.
Should further clarifications be necessary, you can contact us and Fidinam Italia's professionals will be happy to provide the appropriate answers.
