With two rulings published on 4 June 2026, the Italian Revenue Agency further clarified the scope of the inheritance and gift tax exemption provided under Article 3, paragraph 4-ter, of Legislative Decree No. 346 of 31 October 1990 (Inheritance and Gift Tax Code), applicable to transfers in favour of descendants and spouses, as amended by Legislative Decree No. 139 of 18 September 2024. Both rulings converge on the same underlying principle: the exemption is not intended to reward the formal transfer of shareholdings, but rather the effective transfer of control and governance of the business.
Ruling No. 115/2026 concerns a complex corporate reorganisation. The founder of a group with significant consolidated revenues intended to contribute, in a single transaction and under the tax-neutral regime provided by Article 177(2) of the Italian Income Tax Code (TUIR), the entire share capital of the parent company to a newly incorporated holding company featuring three classes of shares. Subsequently, through a family pact, Class A shares representing 40.75% of the capital but carrying 78.36% of the voting rights in ordinary shareholders’ meetings would be transferred to his two children, while the founder would retain Class C shares endowed with veto rights.
On the first issue, the Revenue Agency denied the exemption, holding that the control transferred to the children was only apparent. The special rights retained by the founder, including veto powers over ordinary resolutions concerning profit distributions exceeding a 15% threshold, substantially limited the children’s ability to determine the outcome of ordinary shareholders’ resolutions as a whole.
On the second issue, concerning anti-abuse provisions, the Agency acknowledged that the contribution under Article 177(2), viewed in isolation, was tax neutral. However, it considered the sequence consisting of the tax-neutral contribution followed by the donation of the holding company shares to be abusive under Article 10-bis of Law No. 212 of 27 July 2000. According to the Agency, the arrangement was capable of artificially reducing the taxable base for gift tax purposes, calculated on the holding company’s net equity (€97 million) rather than on the value of the underlying operating parent company (approximately €1.034 billion), without any genuine economic substance. The creation of a new holding company above an already existing family holding structure was considered unnecessary when compared with a direct transfer of the shareholdings to the descendants.
The Agency’s conclusion should not be regarded as a universally applicable principle but rather as being confined to the specific facts of the case, where the newly established holding company merely replicated the exact ownership percentages of the contributed company: the same shareholders holding the same proportions. In substance, the new holding company was simply superimposed on an already existing family holding structure.
Ruling No. 116/2026, by contrast, addresses the transfer of bare ownership only. Shares in a joint-stock company were contributed under the tax-neutral regime into two general partnerships, whose interests were then transferred to the selected child through two family pacts. The child received only the bare ownership of 98% and 98.985% of the partnership interests respectively, while the parents retained usufruct rights and contractual provisions reserving management and representation powers to themselves.
After recalling the principle established by the Italian Supreme Court in Order No. 7619 of 30 March 2026 — according to which the exemption may also apply where usufruct rights are retained, provided that the bare owner undertakes the five-year commitment to continue the business — the Revenue Agency clarified that the exemption can apply to bare ownership only if the bare owner acquires full and effective management powers. Since, in the case at hand, the contractual arrangements left actual management and administration in the hands of the transferors, the generational transfer would have remained merely formal, and the exemption was therefore denied.
Taken together, the two rulings confirm that eligibility for the exemption depends on the same substantive test, expressed in different forms: effective legal control in the first case and full managerial powers in the second. From an anti-abuse perspective, Ruling No. 115/2026 follows the same methodological approach, albeit reaching the opposite conclusion, as earlier Ruling No. 42/2026, where a similar contribution-and-donation structure, despite producing a tax advantage considered undue, was not regarded as abusive because it was supported by valid non-tax business reasons. Once again, the decisive factor is the economic substance of the transaction.
The practical takeaway is clear. When a generational transfer is genuine and properly structured, it can overcome the challenges inherent in the application of these rules and allow taxpayers to benefit fully from the incentives and reliefs that the Italian legislator has specifically designed to promote the continuity of family businesses across generations.
