Glossario Termini Fiscali, Glossary of Tax Terminology
A practical Dictionary of Tax Terminology




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PARADISO FISCALE - TAX HAVEN

A country with a privileged tax regime, characterized mostly by low or even non-existent taxes. The Italian tax system has a series of lists, also known as black lists, of those countries considered tax havens.

Generally, each tax system has norms aimed at limiting or eliminating the distortional effects deriving from relations with countries on the black list.

PARAMETRI PRESUNTIVI - ESTIMATED PARAMETERS

An assessment method applied to subjects for whom the statistics-based tax assessments have not yet been approved. Using certain known accounting data concerning the business, a mathematical formula allows to determine the “presumed” incomes.

If the taxpayer does not spontaneously accept the result of the procedure, the Tax Administration can proceed with an assessment.

PARTECIPAZIONE NON QUALIFICATA - NON-QUALIFIED STOCK

The percentage of rights to vote that can be asserted in the ordinary assembly that is no higher than 20 per cent, or the share of capital no higher than 25 per cent.

For shares traded on regulated markets the aforementioned percentages are 2 and 5 per cent respectively. The appreciation deriving from the transfer of non-qualified stocks is subject to a substitute tax of 20 per cent.

PARTECIPAZIONE QUALIFICATA - QUALIFIED STOCK

The percentage of rights to vote that can be asserted in the ordinary assembly that is higher than 20 per cent, or the share of capital higher than 25 per cent (it is sufficient to surpass one of the two limits).

For shares traded on regulated markets the aforementioned percentages are 2 and 5 per cent respectively.

PARTITA IVA - VAT NUMBER

A sequence of numbers that identifies those subjects whose business is relevant for VAT purposes. It is issued by the Office of the Revenue Agency when the VAT position is created.

The VAT code is made of 11 numbers: the first 7 numbers identify the taxpayer by means of a progressive number, the following 3 numbers identify the province where the Revenue Agency issuing the code has its premises, the last number is a control number.

PENSIONI ESTERE - FOREIGN PENSIONS

Payment made by a public or private entity of a foreign State to someone resident in Italy who worked in that foreign country.
With certain countries there are agreements for the avoidance of double taxation of income, according to which pensions coming from a foreign source are taxed differently, depending on whether they are state or private pensions.

In the first case, generally, they are taxed only in the country of origin; in the second case, they are taxed only in the beneficiary’s country of residence.

PERIODO D’IMPOSTA - TAX PERIOD

The period of time for which a subject is obliged to pay taxes, and which is referred to by the taxpayer when determining his/her taxable income.

For physical persons it always coincides with the solar year, for other subjects it can also span two consecutive years.

PERTINENZE (di un Fabbricato) - OUTBUILDINGS

Land, buildings or parts thereof (gardens, courtyards, access pathways, garages, basements, etc) permanently destined for and actually used as part of a main building.

For Irpef purposes the income of the main residence’s outbuildings is subject to the same deduction as the house.

PIANIFICAZIONE FISCALE - FISCAL PLANNING

The behaviour of a taxpayer who intends to use his/her sources of income so as to reduce as much as possible his/her taxable base.

PLUSVALENZA - APPRECIATION

A profit deriving from the transfer of certain assets at a price higher than that which was paid for them; it is taxable as company income if it is made through commercial activities and can be charged in constant amounts in the tax period in which it was made and in the following four.

On the contrary, it can be taxed as other income in the other cases specifically listed by the law.

POTERI DEGLI UFFICI - POWERS OF THE OFFICES

The powers of the offices are exerted on the taxpayers through accesses, inspections and verifications, or mainly in the offices themselves, with requests for information and documents to the taxpayer and to third parties, such as for example through the questionnaire.

Once the accesses, inspections and verifications have begun, the taxpayer loses the right to certain opportunities granted in his/her favour (i.e. voluntary correction of tax return, legalization of illegal labour).

Amongst other, offices also have the power to inspect the bank accounts of the taxpayer undergoing inspection, through particular procedures.

PREAVVISO TELEMATICO - ONLINE NOTICE

Notice sent by the Revenue Agency to the intermediary who has submitted the tax return of a client online, when an anomaly, an error or an omitted payment emerges during its settlement.

The notice is sent via email and the intermediary is allowed to examine the irregularity noted and evaluate whether it is founded or not.

If the intermediary thinks the irregularity exists, he/she can advise the taxpayer to pay the amount owed, thus benefiting from a reduction of two thirds of the sanction; if the intermediary, instead, thinks that the irregularity noted is groundless or only formal, he/she may explain the situation, thus preventing his/her client getting a notice of irregularity.

After 60 days from the notice has been sent and the intermediary has failed to act, the taxpayer will be sent, by registered mail, a notice of irregularity and from that moment the thirty days provided by the law begin for the reduced definition of the irregularities detected.

PRESCRIZIONE - PRESCRIPTION

When a person loses a right because he/she has not used it for the period of time established by the law.

Tax laws often provide limitation terms of ten years, when not interrupted by an appropriate deed (see: Refund).

PRESUNZIONE DI CESSIONE E DI ACQUISTO - ASSUMPTION OF TRANSFER AND PURCHASE

The possibility for the administration to consider as transferred those assets purchased or imported, or products not found on the taxpayer’s business premises.

If the relative operations are not entered into the accounts, they are considered as illegally transferred, thus constituting tax evasion.

PRESUPPOSTO D’IMPOSTA - TAX ASSUMPTION

For direct taxes (Irpef and Irpeg) it is the possession of income, money or in kind, which falls into one of the categories envisaged by the Tuir (Italian Tax Consolidated Text), wherever it is produced (therefore including foreign income, whether continuative or occasional: the so-called world income system). For non-residents, only the income produced in Italy is taxable.

PRINCIPI CONTABILI INTERNAZIONALI - IAS (International Accounting Standards)

International Accounting Standards have been adopted by the International Accounting Standards Board (IASB) (EN) based in London.

PROCESSO TRIBUTARIO - TAX TRIAL

An inquiry in two stages before the Tax Commissions. In the first instance, the competent provincial tax commission considers appeals against deeds issued by the Revenue Agency’s offices, by Customs, by the local authorities or by the collection agents; regional tax commissions consider appeals against the verdicts of the provincial tax commissions whose premises are in their administrative district.

The Central tax commission (abolished by the 1996 reform) continues to consider appeals submitted by 1st April 1996, until all pending cases are resolved.

By initiating a tax trial a taxpayer can:
  • request that the tax commission (but only in the first instance) orders the suspension of the execution of the deed appealed against
  • promote, if the final ruling is in favour of the taxpayer, the “compliance judgement” in order to oblige the offices to conform to the commissions’ verdicts.
For cases concerning taxes with a value that exceeds 2,582.28 euro the assistance of a qualified legal counsel is necessary. “Value” here means the amount of the tax net of interests and possible sanctions (if there are only sanctions, the value is determined by their sum).

Whatever their value, technical assistance is not required for disputes whose object is the enrolment on the register submitted after the settlement of the tax return by the Service Centres. The president of the commission (or of the section) or the committee can, however, order the party to avail themselves of technical assistance, even when it is not compulsory.

PROCESSO VERBALE DI COSTATAZIONE - REPORT OF VERIFICATION

The deed written by the officials in charge of tax inspection during and at the end of verifications, accesses and inspections carried out on a taxpayer.

The report – a deed that cannot be appealed against autonomously – highlights the irregularities committed by the taxpayer with regard to his/her fiscal obligations and other violations detected, and includes the observations and the comments of the taxpayer and the professional who assists him/her, if there is one. On the basis of the report – a copy of which is given to the taxpayer – the competent office, after sixty days from the submission of possible comments and requests, can issue a verification notice in order to recover the unpaid taxes and to establish the relevant sanctions (see also Taxpayers’ Statute).

PROGRESSIVITÀ DELL’IMPOSIZIONE - PROGRESSIVE RATE OF TAXATION

An increase in the rate that is more than proportional compared to the increase in the taxable base, so that subsequent equal increases thereof correspond to progressive increases in the tax. This system differs from proportional tax, in which the rate does not change when the taxable base changes, so that the tax owed increases by a constant proportion. Irpef is a typical example of a progressive tax.

PROVENTI SOSTITUTIVI E INTERESSI - SUBSTITUTE PROCEEDS AND INTEREST

Sums acquired as a substitute of income, following the transfer of credits, or as a compensation for the damages caused by the loss of incomes. Substitute proceeds and interest belong to the same category as substituted or lost incomes, meaning those incomes producing the credits on which such interest accrue.

For example, the following incomes belong to the same category as employee incomes: redundancy payment, unemployment benefits, mobility, maternity benefits, sums deriving from transactions of any type and subsistence allowance provisionally given to employees with a pending a case before the Judiciary Authority.


AVVERTENZE D'UTILIZZO: Il presente glossario contiene una definizione dei termini più utilizzati in ambito fiscale in Italia, tradotti e spiegati in inglese dall'Agenzia delle Entrate.
La spiegazione di ciascuno dei termini indicati in questo glossario è di carattere meramente orientativo e priva di valore legale; si raccomanda, quindi, di tenere conto del contesto e dell'evento in cui essi vanno applicati, in quanto il significato loro attribuito potrebbe differire rispetto a quello qui rappresentato.

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