TAX CREDIT FOR NON-NATIONAL PRODUCTIONS SHOOTING IN ITALY
Under Italian law qualifying foreign productions can obtain a Tax Credit up to 30% of all eligible production costs. The eligible production costs must not exceed 75% of the total production budget. Each Italian production service company (“PSC”) can recoup up to 20 million Euros per calendar year.
Eligible costs are understood as production expenses, including pre and post production costs, incurred by the PSC in Italy .
The Tax Credit is accrued during production and post production and is based on the costs actually incurred by an Italian PSC. Foreign producers cannot apply directly for this Italian benefit, a local PSC must be engaged as the applicant subject to legal requirements and taxation in Italy.
The Italian Tax Credit is not a reimbursement or a rebate; the credit accrues on a monthly basis and is used by the PSC to offset their tax liabilities including:
– Italian VAT
– PSC’s income tax (e.g. Ires, Irap)
– Italian social security and withholding taxes
If you would like more information or clarification on whether your production qualifies for the Italian 30% Tax Credit program, please contact us, we will be happy to discuss all details with you and provide references from past productions.