Italy: Withholding tax on dividends paid to investment fund breaches EU law, refund granted (court decision)
Luxembourg SICAV was entitled to a full refund of withholding tax
Luxembourg SICAV was entitled to a full refund of withholding tax
The first-level tax court of Pescara on 7 July 2023 held that the imposition of Italian withholding tax between 2009 and 2012 on dividends paid to a Luxembourg UCITS (Undertakings for Collective Investment in Transferable Securities) in the form of a SICAV (Société d'investissement à Capital Variable) was discriminatory and breached EU law. The court thus found that the Luxembourg SICAV was entitled to a full refund of such withholding tax.
The court rejected challenges raised by the tax authority that the documents submitted by the taxpayer in substantiation of its claim were insufficient to prove that the taxpayer qualified as a harmonized UCITS and was the beneficial owner of the dividends.
This decision is consistent with the one issued by the first-level tax court of Pescara on 7 February 2022 (read TaxNewsFlash), as well as the one issued by the second-level tax court of Abruzzo on 21 December 2022 (read TaxNewsFlash).
Read a July 2023 report [PDF 281 KB] prepared by the KPMG member firm in Italy
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