Progressive transformations penalise the super Aid for Economic Growth
The case is that of a progressive transformation from partnership to corporation (but the following considerations are equally valid in the opposite case), resulting in the application of a different tax regime (from IRPEF (personal income tax) to IRES (corporate income tax)) and, consequently, in the need to split the tax year into two distinct tax periods. A first tax period, in which IRPEF rules apply, running from the beginning of the tax year at issue and the effective date of transformation. A second tax period, in which the transformed company is subject to IRES rules, covering the fraction of the tax period between the date subsequent to the effective date of transformation and the tax year end date.
The super ACE regime (see Article 19, paragraph 2, of Decree-Law No. 25 May 2021, the so-called “Decreto Sostegni bis”) rewards increases in equity occurring in the tax year following the one running on 31 December 2020, providing for the application of a 15% ACE rate, instead of the ordinary 1.3% rate, on a maximum increase in equity of €5,000,000. This particularly favourable regime does not impose the limitations of the ordinary ACE, whose value cannot exceed in each financial year that of the net equity shown in the relevant financial statements. Likewise, the pro rata temporis calculation mechanism does not apply to super ACE, since increases are considered on an annual basis and regardless of whether they are the result of payments made before or after Decreto Sostegni bis.
The reference to the tax year following the one running on 31 December 2020 penalises those companies undergoing a progressive transformation over the course of the year that have increased their equity capital, respectively, before and after the transformation (i.e., upon completion of the transformation). In such a case, according to the wording of the legislation, only increases occurred before the transformation are relevant for the purposes of the super ACE, since they fall in the tax year following the one running on 31 December 2020. On the other hand, the relief is not applicable to increases occurring after the transformation becomes effective, which do not fall in the tax year following the one running on 31 December 2020, but in the next tax year after that.
The penalising effect, which will hopefully be eliminated by legislation, is even less justifiable in light of the exclusion of the pro rata temporis calculation mechanism of the super ACE and of its applicability also to increases carried out before the entry into force of the relief..