The recent circular of the Revenue Agency on the new rules on withholding taxes on contracting and subcontracting
The Revenue Agency, with circular no. 1/E of 12th February 2020, provided important clarifications regarding the new rules on withholding taxes in contracting and subcontracting, as introduced by art. 4 of Legislative Decree 124/2019 (with the new wording of art.17-bis, Legislative Decree no. 241/1997), confirming that, among the clients excluded from the checks aimed at averting evasion are condominiums, public and private bodies that do not carry out business or professional activities, and subjects that offer work administration services can be included.
The checks in question, which refer to the contracting out of works or services to companies and therefore do not concern work contracts entered into with operators of the arts and professions, cannot be limited to a formal verification of the documents and communications received. The client must also verify the adequacy and truthfulness of the communications of the contracting company with the obligation to communicate data relating to workers employed, hours worked and wages paid, verifying, among other things, that the latter and the related withholding taxes are not manifestly incongruous with respect to the activity provided by the worker, also in consideration of the actual amount of the contract work and the provisions of the existing collective labour agreements. (LC)
