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Emanuele Falorni - 24/01/2022

Tax News 1/2022

New provisions for occasional self-employed workers and establishment of the single universal allowance for dependent children

In this issue of our Taxnews we shall describe Italy’s new provisions - some of which expired on January 18, 2022 - for occasional self-employed workers, and the establishment (pursuant to Legislative Decree no. 230 dated December 29, 2021) of a single universal allowance (“Assegno unico e universale”) for families with dependent children.

  1. New advance notice obligation prior to the engagement of occasional self-employed workers

Pursuant to art. 13 of Law Decree 146/2021 (which replaced art. 14 of Legislative Decree 81/2015), the work activity of an occasional self-employed worker must be notified in advance by his or her customer to the relevant Territorial Labor Inspectorate (according to where the activity will take place).

The Labor Ministry’s Note no. 29, issued on January 11, 2022, clarifies that:

  • the prior notice obligation applies solely to customers who operate as entrepreneurs;
  • the new rule concerns only “occasional self-employed workers,” i.e., workers who fit the definition set forth in 2222 of the Italian Civil Code − persons who, “in consideration of remuneration, undertake to perform a piece of work or to provide a service, primarily through their own labor and without subordination with respect to the customer” − and who, because of the occasional nature of the activity performed, are subject to the tax regime referred to in art. 67, par. 1, letter l), of Presidential Decree 917/1986 (Italian Income Tax Code).

As the Labor Ministry pointed out, the prior notice obligation does not apply to:

  • coordinated and continuous collaborations;
  • relationships established under and according to art. 54-bis of Law Decree 50/2017 (converted into Law 96/2017) − e., “occasional work,” used especially in the farming, hotel and tourism sectors (the so-called “INPS vouchers”) − which already entail specific obligations regarding the prior notice and management of the work relationship;
  • intellectual professions, because these are already governed by the specific discipline contained in art. 2229 of the Italian Civil Code, and in general all self-employed activities performed habitually and subject to VAT. However, If the work actually performed does not correspond to the one performed out under the VAT regime, the prior notification obligation shall apply;
  • work relationships, such as the one used for the so-called “riders” (delivery drivers who deliver takeaway food and the like), that are “intermediated through a digital platform, including the self-employment activities not performed habitually referred to in art. 67, par. 1, letter l), of the [Italian] Income Tax Code, referred to in Presidential Decree no. 917/1986.” Law 233/2021 (into which Law Decree 152/2021 was converted) introduced a specific discipline regarding the notice obligations, modifying art. 9-bis of Law Decree 510/1996 (converted into Law 608/1996) and establishing inter alia that such relationships must be notified by the customer “by the twentieth day of the month following the establishment of the work relationship”;

As regards the timing of the new obligation to notify occasional collaborations in advance:

  1. any occasional work relationship that started after January 11, 2022 (when the Labor Ministry’s Note was issued), must be notified before the occasional self-employed worker begins to perform the activity in question (the starting date of said activity may be derived from the relevant engagement letter);
  2. any occasional work relationship that started before January 11, 2022, and was still in force at that date (when the Labor Ministry’s Note was issued) had to be notified by January 18, 2022; the same deadline applied to ceased relationships that started on or after December 21, 2021.

In particular, the required prior notice must be made via text message or email, and in any case according to the operating modes referred to in art. 15 of Legislative Decree 81/2015 already in use for intermittent work relationships.

In order to make it easier to comply with the new obligations, the Labor Ministry will update and complement the applications currently in use.  In the meantime, the notice must be sent via email to a specific address assigned to each Territorial Inspectorate. Because this address is for ordinary, non certified emails, the notifying customer must keep a copy of the notice, which may have to be produced during a possible inspection.

The notice need not be sent as an attachment, but can be inserted directly in the email message; it must contain at least the following (in absence of which the notice itself will be deemed as not having been submitted):

  • the data of the customer and of the worker;
  • the place where the work will be performed;
  • a brief description of the work;
  • the date on which the activity is supposed to start and the length of time that it will likely take (e.g., one day, one week, one month). If the job in question hasn’t been finished within the stated period, the customer will have to submit a new notice;
  • the worker’s remuneration (if decided at the time of his or her engagement).

Failure to comply shall entail the application of an administrative fine ranging from 500 to 2,500 euros in respect to each occasional self-employed worker for whom the prior notice has not been filed or has been filed late.

 

 

  1. The new single and universal allowance for dependent children

The new single universal allowance AUU (Assegno Unico Universale) for dependent children may requested as of January 1, 2022. Applications must be submitted to INPS (the Italian social security agency) telematically via its web portal, either accessing INPS’s website (using a SPID, CIE or CNS code) or via a “patronato” (non-profit social welfare organization that provides multiple types of assistance to workers and others). The application can be submitted by one of the child’s parents (whether or not the child lives with him or her) or, in absence thereof, by the person who holds parental responsibility for the child in question, by a child who is of age on his or her own behalf, or by a foster parent or legal guardian in the sole interest of the minor. This is a structural provision; the application must be filed yearly. 

The request is valid for one year and covers the monthly payments made from March of the year the application was filed to February of the following year. For this reason, the measures regarding temporary allowances for minor children have been extended through January and February 2022, and the amount per family unit was increased.

The new single allowance will go into effect on March 1, 2022, hence nothing will change from January 1 to February 28, 2022. The new allowance, which will apply from March 1 to December 31, 2022, combines and replaces several existing child benefits, including the family unit allowance (ANF – “Assegno per il nucleo familiare”), the bonus for birth (“Bonus mamma domani”), and income tax (IRPEF) deductions for dependent children up to 21 years old.  Hence, starting in March 2022, birth bonuses and tax deductions will not appear on employee payslips and retirement pension payslips.

The current allowance for kindergarten costs (“bonus asilo nido”) remains in force, as do tax deductions for expenses incurred for dependent children of any age (e.g., education and medical expenses).

In its message no. 4747, issued December 31, 2021, INPS specified that in the case of applications filed between January 1, 2022 and June 30, 2022, AUU benefit will be applied from March 2022; hence, no monthly payment due will be lost. For applications submitted on or after July 1, 2022, the benefit shall start the month following the one the relevant application was filed.

The new allowance will be paid directly by INPS, hence it shall no longer go through employee or retirement pension payslips. INPS has explained that payments related to requests filed in January and February 2022 will start being made from March 15 to March 21, 2022, while those related to requests filed in or after March 2022 will start at the end of the month following the one the request was filed.

People who used to receive temporary allowances (“Assegno temporaneo”) must reapply for AUU allowance; people entitled to citizenship income (“Reddito di cittadinanza”) do not need to do so, because they will receive the new single allowance automatically. Allowance payments will be made through the entitled person’s IBAN (bank or postal checking account, credit or debit card, savings account), or paid in cash at any Italian post office.

The amount of the allowance depends on the number of children and on the household’s ISEE (socio-economic indicator), based on a complex calculation mechanism. In particular: 

  1. for each minor child (i.e., up to 18 years old): €175 a month if the ISEE does not exceed €15,000; if the ISEE is above that level, the allowance is reduced accordingly, with the minimum amount being €50 a month;
  2. for each adult child up to 21 years old: €85 a month, if the ISEE does not exceed €15,000; if the ISEE is above that level, the allowance is reduced accordingly, with the minimum amount being €25 a month.

Moreover, the allowance is increased for each child born after the second one, for each child with disabilities, and for mothers less than 21 years old. Hence, a valid and correct ISEE must be submitted in order for one’s single universal allowance to be calculated. Applications may be submitted without the ISEE, but in this case only the minimum monthly allowance will be granted (€50 for minors and €25 for adult children). Individuals submitting their ISEE by June 30, 2022, will receive the full allowance they are entitled to, with back payments starting from March, 2022.

 

 

  1. Eligibility for the single universal allowance

The single allowance will be granted to families for:

  1. each dependent minor child; for newborns, the allowance will apply as of the seventh month of the mother’s pregnancy;
  2. each dependent adult child up to the age of 21, provided he or she meets at least one of the following conditions: 1) is attending school, vocational training or university; 2) is serving an internship, or working, with a total income of less than €8,000 a year; 3) she is registered with a public employment agency as unemployed and in search of a job; 4) is engaged in the Italian universal civil service;
  3. each dependent child with disabilities, with no age limit.


  1. Requirements for requesting the single universal allowance

At the moment the request for the single allowance is filed, and for the entire duration of the benefit, the applicant must meet all the following requirements:

  1. he or she must be an Italian citizen or the citizen of a EU member state, or a family member thereof, or hold a temporary or permanent permit to reside in Italy, or be a non-EU citizen with a long-term permit to reside in the EU, or hold a single work permit authorizing him or her to perform a work activity in Italy for a period of more than six months, or hold a permit authorizing him or her to reside in Italy for research purposes for more than six months;
  2. he or she must be liable to pay income tax in Italy;
  3. he or she must be resident and domiciled in Italy;
  4. he or she must have resided in Italy for at least two years, whether continuously or not, or hold an employment contract for an indefinite period of time or a fixed-term contract with a duration of at least six months.