dividend tax
Dividend Tax on an Italian S.r.l. Paid Abroad
By Andrea Sala, Tax and Cross-Border Compliance Lead, Milan · Reviewed by Stefano Colombo · Updated 12 October 2026
Rules as in force in 2026 · next review January 2027
A dividend from an Italian S.r.l. meets two taxes: corporate tax on the company's profit, then a withholding at the payment that turns on who the owner is.
In 2026 an Italian S.r.l. pays IRES at 24% on its profit, then withholds a final 26% on a dividend paid to a non-resident, refundable up to 11/26 on proof of foreign tax. EU and EEA companies bear 1.20%; an EU parent may request a refund, or non-application at source; a treaty may cap the rate (Arts. 27 and 27-bis D.P.R. 600/1973).
How is an S.r.l.'s profit taxed before a dividend leaves Italy?
Two layers of tax sit between an Italian company's profit and its owner abroad. The first is IRES, the corporate income tax, at 24% of the profit, as the Agenzia delle Entrate's IRES page states. The dividend comes out of utili (profits) that have already borne it; the rates themselves are in the corporate tax rates guide.
The second layer is a withholding (ritenuta) that the paying S.r.l. makes as sostituto d'imposta (withholding agent) when it pays its socio (member) abroad on its quota (the holding in an S.r.l., a quota rather than a share), under Art. 27 D.P.R. 600/1973. The company's own yearly calendar is separate: we coordinate filing the corporate return and running payroll for an Italian company with the professionals who sign them.
The rate on that payment depends on who the owner is: its State, its legal form, how much it holds and for how long. Those facts are fixed when the structure is designed, before the first payment, so this guide sets the rates out by kind of owner and leaves the choice to the owner and its adviser.
What is the withholding tax on a dividend paid to a foreign shareholder?
On SRL dividends paid to a non-resident shareholder, the Italy dividend withholding tax is 26%, and it is final: a ritenuta a titolo d'imposta, after which the recipient owes nothing more in Italy on that income. The rate rests on Art. 3(1) D.L. 66/2014, which sets withholdings on capital income at 26% for income collectable from 1 July 2014; the withholding itself sits in Art. 27(3) D.P.R. 600/1973.
Art. 27(3), in the text in force to 31 December 2026, still prints 27%: a drafting relic, since the refund of 11/26 in the same comma fits only a 26% rate. The other relics are in the printed-rate table below.
A non-resident shareholder may recover up to 11/26 of the withholding, limited to tax it proves it definitively paid abroad on the same profits, by a certification of the competent foreign tax office (Art. 27(3)). As arithmetic, with foreign tax of at least 11% proved, the net Italian tax is 15%.
Holders of savings shares, pension funds, PEPP sub-accounts and comma 3-ter companies cannot claim it.
Which rate applies to which kind of owner?
The Italian withholding tax on dividends turns on the recipient (percipiente), not on the S.r.l. Each row below gives the conditions, the proof and the article, as in force in 2026. No row says which one fits a given owner: the owner checks the conditions, and the decision belongs in a conversation with its adviser.
| Owner | Rate or relief | Conditions | Proof | Article |
|---|---|---|---|---|
| Non-resident shareholder with no better claim | 26%, final | paid to a non-resident | none named | Art. 27(3) D.P.R. 600/1973; Art. 3(1) D.L. 66/2014 |
| The same, foreign tax proved | refund of up to 11/26 of the withholding (15% net where at least 11% is proved, arithmetic) | tax definitively paid abroad on the same profits; not for savings-share holders, pension funds, PEPP sub-accounts or comma 3-ter companies | certification of the competent foreign tax office | Art. 27(3) |
| EU company, or EEA company of a listed State, subject to corporate income tax | 1.20%, final | resident there; holding not connected with an Italian permanent establishment; no minimum holding or period in the comma | the statute names none | Art. 27(3-ter), new text from 1 January 2026 |
| EU parent company | a refund on request, or non-application at source on request | Directive-annex form; EU tax resident; listed tax without option or exemption; at least 10% held directly for one year without interruption | certification of its tax authority and its own declaration; by the payment date for non-application | Art. 27-bis |
| EU or EEA pension fund, PEPP sub-account | 20% | profits paid from 12 August 2026 | none named | Art. 27(3); D.Lgs. 148/2026 |
| Foreign collective investment undertaking (OICR) | the withholding does not apply | UCITS or AIF conditions; EU or EEA State with adequate exchange of information | none named | Art. 27(3) |
| UK company | 26% with the 11/26 refund, or the treaty cap: 5% (company controlling at least 10% of the votes), 15% otherwise | third country from 1 January 2021: no EU route | residence attestation on the Agenzia's model or the foreign form | UK Convention Art. 10(2); Agenzia Brexit FAQ |
| Other non-EU, non-EEA owner | 26% with the 11/26 refund; a treaty cap where a treaty applies (not tabled here) | the more favourable rule for the taxpayer | as for a treaty claim | Art. 27(3); Art. 169(1) TUIR |
An Italian S.r.l. pays a dividend to an owner abroad
Any non-resident, no better claim
paid to a non-resident
- 26%, finalArt. 27(3) D.P.R. 600/1973; Art. 3(1) D.L. 66/2014
- Refund of up to 11/26on proof of foreign tax; 15% net where at least 11% is proved (arithmetic)
EU or EEA company
subject to corporate tax; holding not connected with an Italian permanent establishment
- 1.20%, finalArt. 27(3-ter), new text from 1 January 2026
EU parent company
at least 10% held directly for one year without interruption
- A refund on requestor non-application at source on request (Art. 27-bis)
EU or EEA pension fund
or a PEPP sub-account
- 20%on profits paid from 12 August 2026 (Art. 27(3); D.Lgs. 148/2026)
UK company
a third country from 1 January 2021: no EU route
- 26% with the 11/26 refundArt. 27(3)
- 5% Convention capa company controlling at least 10% of the votes (UK Convention Art. 10(2))
- 15% Convention capin all other cases (UK Convention Art. 10(2))
Texts as in force in 2026; the page does not choose the branch for the reader.
What do EU and EEA companies and pension funds pay?
Companies and entities subject to a corporate income tax in an EU State, or in an EEA State on the list of the decrees under Art. 11(4)(c) D.Lgs. 239/1996, and resident there, bear a final 1.20% on profits from holdings not connected with an Italian stabile organizzazione (permanent establishment), under Art. 27(3-ter) D.P.R. 600/1973. The comma sets no minimum holding and no holding period.
D.L. 38/2026 Art. 11 replaced comma 3-ter with the same rate and conditions, applying from 1 January 2026, and restated the 1.20% in the consolidated text on payments and collection approved by D.Lgs. 33/2025. As arithmetic, 1.20% equals 5% of a profit taxed at 24%.
EU and EEA pension funds and PEPP sub-accounts bear 20% on profits paid from 12 August 2026, when D.Lgs. 148/2026 entered into force (Art. 27(3)); older texts carry 11%, now superseded. The withholding does not apply to foreign collective investment undertakings (OICR) meeting the UCITS or AIF conditions, in an EU or EEA State with adequate exchange of information (Art. 27(3)).
How does the EU Parent-Subsidiary relief work?
The regime madre-figlia (Parent-Subsidiary regime) of Art. 27-bis D.P.R. 600/1973, text in force from 23 July 2016 to 31 December 2026, sets four conditions, then two ways to obtain the relief.
Who qualifies
A company in a form of the Directive annex, tax resident in an EU Member State and not treated as resident outside the EU under a treaty, subject to a listed tax without an option or exemption regime. An EEA-only company keeps the 1.20%.
At least 10%, held directly
10% of the capital for profits distributed from 1 January 2009 (Art. 2(2) D.Lgs. 49/2007, reproduced in note (97) of the article). The printed 20% is a relic.
One year without interruption
The parent holds the stake directly and without interruption for at least one year (Art. 27-bis(1)).
The proofs
A certification of the parent's tax authority on its form, residence and tax conditions, plus the parent's declaration on the one-year holding (Art. 27-bis(2)).
A refund on request
The parent has the right, on request, to the refund of the withholding of commi 3, 3-bis and 3-ter of Art. 27 (Art. 27-bis(1)).
Or non-application at source on request
On the parent's request, and where the conditions are met, the paying S.r.l. may leave the withholding unapplied. The documents are acquired by the payment date and kept until the assessment terms have run (Art. 27-bis(3)).
What does a UK or other non-EU owner pay?
The Agenzia delle Entrate's Brexit FAQ treats the United Kingdom as a third country (Paese terzo) from 1 January 2021. The 1.20%, the Parent-Subsidiary relief and the interest-and-royalties exemption are therefore closed to a UK company, which falls back on the 26% with the 11/26 refund, or on the treaty cap. On our reading, the same holds for any owner outside the EU and the EEA.
The UK Convention, signed at Pallanza on 21 October 1988 and given effect in the UK by the Double Taxation Relief (Taxes on Income) (Italy) Order 1990, caps Italian tax on dividends at 5% of the gross amount where the beneficial owner is a company controlling, directly or indirectly, at least 10% of the voting power in the payer, and at 15% in all other cases (Art. 10(2)). More in our guide to the Italy-UK tax treaty.
Art. 169(1) TUIR, text in force from 1 January 2004 to 31 December 2026, applies the TUIR, if more favourable to the taxpayer, also in derogation of double-tax agreements. The taxpayer relies on the more favourable rule; this guide does not say which applies to a given owner, and tables no other country (see the Italy-US tax treaty guide).
Does an Italian holding in the chain change the tax?
An Italian company that receives a dividend leaves 95% of it out of its income (Art. 89(2) TUIR, as in force in 2026). As arithmetic, 5% taxed at 24% is an effective 1.2%: the same number as the 1.20% withholding above, but a different thing. D.L. 38/2026 Art. 11 repealed the 2025 restrictions from 1 January 2026, so the 95% stands in full.
The holding's own payment to its foreign parent then meets the same rate ladder again. A holding moves the point where the tax falls; it does not remove it. The conditions are on our page about when an Italian holding company makes sense for a group, and the review of a specific chain is tax planning for a foreign-owned S.r.l., done with the owner's adviser.
What is withheld on interest, royalties and service fees?
An S.r.l. pays its foreign owner more than dividends, and each payment has its own article, as in force in 2026: Art. 25 D.P.R. 600/1973 for royalties, equipment rent and fees for services, Art. 26 for interest, Art. 26-quater for interest and royalties between associated EU companies, Art. 27(3-bis) for excess shareholder loans. Two points stay open: the taxable part of a royalty, and how an intra-group management or technical fee is characterised.
| Payment | Italian withholding | Exemption or exclusion | UK Convention cap | Article |
|---|---|---|---|---|
| Remuneration of excess shareholder loans (company to which Art. 98 TUIR applies) | withheld like a dividend, under commi 3 and 3-ter of Art. 27, net of any Art. 26 withholding | loans lent by an Italian permanent establishment of the non-resident; the scope of Art. 98 is not covered here | not stated on this page | Art. 27(3-bis) |
| Interest to a non-resident lender | 26%, final (the printed 12.50% on account is a relic) | medium and long-term loans to businesses from EU credit institutions, EU-authorised insurers, supervised foreign institutional investors; associated EU companies, 25% of the votes held for one year | not above 10% | Art. 26(5); Art. 26-quater |
| Royalties (works of the mind, patents, trade marks, know-how) | 30%, final, on the taxable part of the amount | associated EU companies, 25% of the votes held for one year; the taxable part is not stated on this page | not above 8% | Art. 25; Art. 23(2)(c) TUIR; Art. 26-quater |
| Rent for industrial, commercial or scientific equipment located in Italy | 30%, final, on the amount | payments to Italian permanent establishments | not stated on this page | Art. 25 |
| Fees for self-employment-type services, also in the course of a business | 30%, final | services performed abroad; sums to Italian permanent establishments | not stated on this page | Art. 25 |
| Intra-group management or technical fee | open: a service under Art. 25 or a know-how royalty under Art. 23(2)(c) TUIR | an adviser's check | not stated on this page | Art. 25; Art. 23 TUIR |
Is the owner chain still open? We review where the parent sits, what it holds and which payments will flow, before the first payment.
Why does the statute print 27% when the rate is 26%?
Normattiva prints figures that are not the rates. This guide uses two words for them: the printed rate, which stands in the text, and the operative rate, which applies. Most of the gap comes from Art. 3 D.L. 66/2014, which set capital-income withholdings at 26% from 1 July 2014.
| Printed figure and place | Operative figure | Why | Source |
|---|---|---|---|
| 27% in Art. 27(3) D.P.R. 600/1973, dividends to non-residents | 26% | Art. 3(1) D.L. 66/2014 sets 26% on capital income collectable from 1 July 2014; the 11/26 refund in the same comma fits only 26% | Art. 27(3); D.L. 66/2014 |
| 27% in Art. 27(5), withholding on exempt entities that are resident payees | not a payment abroad; never a dividend rate for an owner abroad | the same relic family | Art. 27(5); D.L. 66/2014 |
| 20% holding in Art. 27-bis(1) | 10% for profits distributed from 1 January 2009 | Art. 2(2) D.Lgs. 49/2007, reproduced in note (97) of the article | Art. 27-bis, note (97) |
| 12.50% on account in Art. 26(5) | 26%, final | Art. 3(1) D.L. 66/2014 | Art. 26(5); D.L. 66/2014 |
| 11% for pension funds in older texts and files | 20% from 12 August 2026 | D.Lgs. 148/2026 | Art. 27(3); D.Lgs. 148/2026 |
What must an S.r.l. have before it pays a dividend?
A dividend cannot be resolved before the accounts exist and are approved. The rules below come from Book V of the Civil Code (Codice civile), stated with their articles.
- Draft accounts (bilancio) reach the members within the term in the deed, at most 120 days after year end (Art. 2478-bis c.c.).
- Up to 180 days where the deed allows it and the S.r.l. draws consolidated accounts, or its structure and object require it (Art. 2364(2) c.c.).
- The approved accounts are filed with the Register of Companies within 30 days (Civil Code, Book V).
- Only profits actually earned and shown in approved accounts are distributed (Art. 2478-bis c.c.).
- Nothing is distributed while capital is impaired, until it is restored or reduced (Art. 2478-bis c.c.).
- A low-capital S.r.l. (capital below EUR 10,000) sets aside at least one fifth of its net profit until reserve plus capital reach EUR 10,000 (Art. 2463(5) c.c.).
- The year's profit has already borne IRES at 24% (Agenzia delle Entrate, IRES page).
What does the S.r.l. do when it pays a dividend abroad?
The paying S.r.l. is the withholding agent, from the payment date to the end of the assessment terms. We coordinate them; the company itself, or an intermediary of Art. 3(3) D.P.R. 322/1998, transmits.
law a term set by statutederived worked out for a payment made in 2026open not settled by the sources
The payer's calendar for a dividend paid in 2026
- 1
Payment date
The S.r.l., as withholding agent (sostituto d'imposta)
- law Parent-Subsidiary documents in hand by this date (Art. 27-bis(3))
- 2
Withheld tax paid
The S.r.l., through the unified payment
- law by the 16th of the month of expiry; the next working day after a Saturday or holiday (Art. 18 D.Lgs. 241/1997)
- 3
Certificate to the recipient, data to the Agenzia
The S.r.l.
- law by 16 March of the year after the payment (Art. 4 D.P.R. 322/1998)
- derived 16 March 2027, derived for a payment made in 2026
- 4
Annual declaration of withholding agents
The S.r.l., or an Art. 3(3) D.P.R. 322/1998 intermediary
- law sent between 15 April and 31 October (Art. 4(4-bis) D.P.R. 322/1998)
- 5
Proofs kept
The S.r.l.
- law until the assessment terms run: 31 December of the fifth year after filing, the seventh if no return (Art. 43 D.P.R. 600/1973)
The owner's side
- A
Certification from its own tax authority
The owner, before the payment
- law Parent-Subsidiary route (Art. 27-bis(2))
- B
Refund claim if too much was withheld
The owner
- law general term 48 months from the withholding (Art. 38 D.P.R. 602/1973)
- open whether it governs the 11/26 refund
Statutory terms as in force in 2026
Apply the rate that fits the payment and the recipient
The row of the owner or other-payments table whose conditions are met at the payment (Arts. 25 and 27 D.P.R. 600/1973).
Documents in hand by the payment date
For the withholding to be left unapplied on the parent's request, its certification and declaration are acquired by then; otherwise the S.r.l. withholds and the parent requests the refund (Art. 27-bis).
Pay the withheld tax
Through the unified payment, by the 16th of the month of expiry, or the next working day if the 16th is a Saturday or a holiday (Art. 18 D.Lgs. 241/1997, text in force to 31 December 2026).
Certificate to the recipient by 16 March
The certificazione unica of the sums paid and the tax withheld goes to the recipient by 16 March of the year after the payment, and electronically to the Agenzia by the same date (Art. 4 D.P.R. 322/1998, as in force in 2026). For a 2026 payment: 16 March 2027.
Annual declaration of withholding agents
One dichiarazione dei sostituti d'imposta naming all recipients, sent electronically for the previous calendar year between 15 April and 31 October (Art. 4(1) and (4-bis)); 2026 payments go in the declaration filed in that window the following year. The rules on who may transmit an Italian company's tax return apply to it.
Keep the proofs
Attestations of payment are kept for the period of Art. 43 D.P.R. 600/1973: assessment notices come by 31 December of the fifth year after the return was filed, the seventh where none was. The Parent-Subsidiary documents are kept as long (Art. 27-bis(3)).
Which documents does the foreign owner need, and how is excess tax recovered?
The owner obtains its proofs from its own tax authority before the first payment; this guide gives no duration, so plan it as the longest step. The Agenzia's treaty FAQ explains the models a non-resident uses.
- Parent-Subsidiary route: the foreign tax authority's certification of residence, form and tax status (Art. 27-bis(2)).
- Same route: the parent's declaration on the one-year holding (Art. 27-bis(2)).
- Treaty rate: a residence attestation on the Agenzia's model or the foreign authority's own form.
- The Agenzia's models of the Provvedimento of 10 July 2013, an Italian unilateral initiative, for a treaty rate, an exemption or a refund.
- Still valid: the forms agreed with Germany, Portugal, the United Kingdom, the United States, Sweden and Switzerland (Agenzia delle Entrate).
- 11/26 refund: the foreign tax office's certificate of tax paid (Art. 27(3)).
- Interest and royalties exemption: a residence attestation and a beneficial-owner declaration by the payment date (Art. 26-quater).
- The certificate the S.r.l. issues by 16 March (Art. 4 D.P.R. 322/1998).
If too much was withheld, the general term to claim it back is 48 months from the withholding (Art. 38 D.P.R. 602/1973, text in force to 31 December 2026). That it governs the 11/26 and treaty refunds is our reading, not an Agenzia statement. A UK owner applies for the Convention's refund within the time limit of the State that withheld, with a residence certificate (Art. 29(2)).
What changes if the founder moves to Italy?
If the founder becomes resident in Italy, a dividend paid to them as a resident individual bears a final withholding of 26% on holdings not connected with a business (Art. 27(1) D.P.R. 600/1973, text in force to 31 December 2026). A non-resident individual stays under the rules above. The number is the same; residence decides which rule the S.r.l. applies.
The residence tests and the personal regimes, such as the flat tax for new residents of Art. 24-bis TUIR and the regime of Art. 24-ter TUIR, are personal: they are not a tax on the S.r.l.'s payment. They are set out in our guide to what changes in Italian tax when the owner moves to Italy.
How much is withheld on a EUR 100,000 dividend?
An illustration on a gross dividend of EUR 100,000, a figure chosen for the arithmetic and not a statutory amount. The rates are the ones set out above. The table is not a calculator, and it does not say which row applies to a given owner.
| Case | Rate | Italian tax on EUR 100,000 | How it is obtained |
|---|---|---|---|
| Non-resident, no better claim | 26% | EUR 26,000 | withheld at payment (Art. 27(3); D.L. 66/2014) |
| The same, foreign tax of at least 11% proved | 26% less 11 points | EUR 15,000 net | refund of 11/26 on request, with the foreign certificate (Art. 27(3)) |
| EU or EEA company | 1.20% | EUR 1,200 | withheld at payment (Art. 27(3-ter)) |
| UK company controlling at least 10% of the votes | at most 5% | at most EUR 5,000 | treaty claim (UK Convention Art. 10(2)) |
| UK owner, other cases | at most 15% | at most EUR 15,000 | treaty claim (UK Convention Art. 10(2)) |
| EU or EEA pension fund, from 12 August 2026 | 20% | EUR 20,000 | withheld at payment (Art. 27(3)) |
| EU parent under Art. 27-bis | a refund on request, or non-application at source on request | no amount shown | documents by the payment date (Art. 27-bis) |
From our practice: an EU parent's first dividend, a worked example
A worked example from the rules on this page, not a client case. An EU parent company has held at least 10% of a Milan S.r.l. directly, without interruption, for a year; the S.r.l. approves its accounts and a dividend is resolved. The parent's certification and declaration reach the S.r.l. before the payment date, so on the parent's request the S.r.l. may leave the withholding unapplied, and it keeps the documents (Art. 27-bis). Had they arrived later, the S.r.l. would withhold and the parent would request the refund. Either way, the S.r.l. issues the certificate by 16 March and lists the payment in its annual declaration (Art. 4 D.P.R. 322/1998).
On such a file we check the holding dates in the company's records, ask the parent for its certification and declaration well before the payment date, and coordinate the payer's side with the company's accounting provider.
Which rules apply after 2026?
Normattiva prints Arts. 25, 26, 26-quater, 27 and 27-bis D.P.R. 600/1973, Art. 38 D.P.R. 602/1973 and Art. 18 D.Lgs. 241/1997 as in force to 31 December 2026. D.Lgs. 33/2025 approves the consolidated text (testo unico) on payments and collection, whose Title II covers withholding at source, and D.L. 38/2026 already restates the 1.20% there. The date from which it displaces the 2026 articles is not given here.
D.Lgs. 117/2026, in force from 4 July 2026, approves the consolidated income-tax text that takes over Arts. 23, 89 and 169 TUIR. D.Lgs. 141/2026 approves a consolidated text on filings and assessment, so Art. 4 D.P.R. 322/1998 is cited as in force in 2026. No successor article number is printed on this page, and the guide is reviewed in January 2027.
Sources
- D.P.R. 600/1973, Art. 27: withholding on dividends, the 11/26 refund, the 1.20%, pension funds, OICR, excess shareholder loans (Normattiva, text as in force in 2026)
- D.P.R. 600/1973, Art. 27-bis: the Parent-Subsidiary refund, or non-application at source, on request (Normattiva, text as in force in 2026)
- D.P.R. 600/1973, Art. 26: interest paid to a non-resident (Normattiva, text as in force in 2026)
- D.P.R. 600/1973, Art. 25: royalties, equipment rent and fees for services paid to non-residents (Normattiva, text as in force in 2026)
- D.L. 66/2014, Art. 3: the 26% rate on capital income (Normattiva)
- D.L. 38/2026, Art. 11: the 1.20% in its new text from 1 January 2026 (Normattiva)
- D.Lgs. 148/2026: in force 12 August 2026, the 20% rate for pension funds (Normattiva)
- TUIR, Art. 169: the more favourable rule beside double-tax agreements (Normattiva, text as in force in 2026)
- D.P.R. 322/1998, Art. 4: the annual declaration of withholding agents and the certificate (Normattiva, text as in force in 2026)
- Double tax treaties: frequently asked questions (Agenzia delle Entrate)
- Brexit FAQ (Agenzia delle Entrate)
- The Double Taxation Relief (Taxes on Income) (Italy) Order 1990, with the Convention signed at Pallanza on 21 October 1988 (legislation.gov.uk). Articles cited: 10(2), 11(2), 12(2), 29(2).
Also cited, by name: Art. 26-quater and Art. 43 D.P.R. 600/1973; Arts. 23 and 89 TUIR; Art. 38 D.P.R. 602/1973; Art. 18 D.Lgs. 241/1997; D.Lgs. 33/2025, D.Lgs. 117/2026 and D.Lgs. 141/2026 (Normattiva); the Agenzia delle Entrate's IRES page and its treaty models and instructions page; the Civil Code, Book V (Arts. 2364, 2463 and 2478-bis). Checked on 10 October 2026.
Frequently asked questions
How is an S.r.l. taxed in Italy before it pays a dividend?
The S.r.l. pays IRES, the corporate income tax, at 24% on its profit, so a dividend comes out of profit that has already been taxed. When the dividend is paid to a shareholder abroad, the S.r.l. then withholds a second tax on the payment itself, under Art. 27 D.P.R. 600/1973 as in force in 2026.
What is the dividend tax in Italy when an S.r.l. pays a foreign shareholder?
A withholding of 26%, final, under Art. 27(3) D.P.R. 600/1973 read with Art. 3(1) D.L. 66/2014. Final means the shareholder owes nothing more in Italy on that dividend. The article still prints 27%, a drafting relic: the refund of 11/26 in the same comma only fits a 26% rate.
Is dividend income from an Italian S.r.l. taxable in Italy if the shareholder lives abroad?
Yes. The paying S.r.l. withholds the tax as a final tax, so the shareholder owes nothing more in Italy on that dividend; lower rates depend on the kind of owner. If the founder becomes resident in Italy, a dividend on a holding not connected with a business also bears a final 26% (Art. 27(1) D.P.R. 600/1973).
Can the foreign shareholder recover part of the withholding?
Up to 11/26 of it, limited to foreign tax the shareholder proves it definitively paid on the same profits, with a certification of the foreign tax office (Art. 27(3) D.P.R. 600/1973). With foreign tax of at least 11% proved, the net Italian tax is 15%, as arithmetic. Pension funds and the companies of comma 3-ter cannot claim it.
What does an EU or EEA parent company pay?
A final 1.20% on holdings not connected with an Italian permanent establishment (Art. 27(3-ter) D.P.R. 600/1973). An EU parent that has held at least 10% directly for a year may instead request a refund, or ask the S.r.l. to leave the withholding unapplied if the documents are in hand by the payment date (Art. 27-bis).
Did the 2026 amendment change the 1.20% rate?
No change of rate. D.L. 38/2026 Art. 11 replaced comma 3-ter of Art. 27 with the same 1.20% and the same conditions, applying from 1 January 2026, and restated the rate in the consolidated text on payments and collection approved by D.Lgs. 33/2025. The comma still sets no minimum holding and no holding period.
What is the minimum holding for the Parent-Subsidiary relief?
10% of the capital, held directly and without interruption for at least one year, for profits distributed from 1 January 2009 (Art. 27-bis D.P.R. 600/1973, note (97)). The 20% printed in comma 1 is a relic. The parent also produces a certification of its own tax authority and a declaration on the holding.
Does a UK parent get the EU rates?
No. The Agenzia delle Entrate treats the United Kingdom as a third country from 1 January 2021, so a UK company falls back on the 26% with the 11/26 refund, or on the treaty cap: 5% of the gross dividend for a company controlling at least 10% of the votes, 15% otherwise (UK Convention Art. 10(2)).
Is there a lower rate for pension funds?
Yes, for EU and EEA pension funds and PEPP sub-accounts: 20% on profits paid from 12 August 2026, when D.Lgs. 148/2026 entered into force; older texts carry 11%, now superseded. The withholding does not apply to foreign collective investment undertakings meeting the UCITS or AIF conditions in an EU or EEA State with adequate exchange of information.
What must an S.r.l. have before it can pay a dividend?
Approved accounts showing profits actually earned, and no impaired capital (Art. 2478-bis c.c.). A low-capital S.r.l. also sets aside at least one fifth of its net profit until reserve and capital reach EUR 10,000 (Art. 2463(5) c.c.). The approved accounts are filed with the Register of Companies within 30 days.
Who withholds, and what does the S.r.l. have to do afterwards?
The paying S.r.l. withholds, as withholding agent. It pays the tax by the 16th of the month of expiry, gives the recipient a certificate by 16 March of the next year, sends the same data to the Agenzia and files its annual declaration between 15 April and 31 October (Art. 4 D.P.R. 322/1998).
What is withheld on royalties paid to a foreign licensor?
30%, final, on the taxable part of the royalty, and 30% on the amount of a rent for equipment located in Italy (Art. 25 D.P.R. 600/1973). The UK Convention caps royalties at 8%, and royalties between associated EU companies with 25% of the votes held for a year are exempt (Art. 26-quater).
What is withheld on interest on a loan from the foreign parent?
26%, final (Art. 26(5) D.P.R. 600/1973 with D.L. 66/2014). Interest between associated EU companies, and interest on loans from qualifying EU lenders and supervised investors, can be exempt; the UK cap is 10%; and the remuneration of excess shareholder loans is withheld like a dividend (Art. 27(3-bis)).
Are fees for services paid to a foreign group company withheld?
A final 30% applies to fees for self-employment-type services, also when rendered in the course of a business, unless the services are performed abroad (Art. 25 D.P.R. 600/1973). Whether an intra-group management or technical fee is a service or a know-how royalty is open, and a check for an adviser.
Does an Italian holding in the chain change the tax?
The holding leaves 95% of the dividends it receives out of its income (Art. 89(2) TUIR), an effective 1.2%, but its own payment to the foreign parent meets the same withholding ladder again. A holding moves the point where the tax falls; it does not remove it. Whether one fits a group is for the owner and its adviser.
Review a specific owner chain. Where the parent sits and which payments will flow, set against the rate ladder: tax planning for a foreign-owned S.r.l.
The proof a treaty claim needs. Who issues it and how a treaty claim uses it: Italian Tax Residency Certificate and Treaty Relief