Voluntary disclosure for crypto-assets and related income is now available

On 7 August, the Italian Revenue Agency issued the instructions and timeframe for accessing the regularisation provided for in the last Budget Law (No. 197/2022). The measure also approves the outline of an explanatory report to be attached to the application, which can be prepared with the assistance of a tax lawyer given the complexity of the matter.

The application must be submitted by 30 November, along with the payment of taxes on income from crypto-assets and penalties for violating tax monitoring obligations.

Individuals, non-commercial entities and simple partnerships resident in Italy who held crypto assets by 31 December 2021, in violation of tax monitoring obligations or without declaring the relevant income are eligible for the procedure.

The regularization is possible for tax periods up to 2021 with unexpired statutes of limitations for the assessment of income tax and additional tax violations.

The application must be sent - via certified electronic mail - by 30 November to the Regional Directorate of the Revenue Agency responsible according to tax domicile of the taxpayer.

The application requires the receipt of the tax payment and an accompanying report with documentation proving the origin of the sums invested, including bank accounts used for the purchase of crypto-assets, wallet addresses, numbers of transactions, etc.

Crypto asset regularization occurs once it has been established that the source of the invested funds is not linked to any criminal activities, rendering the origin of the sums invested irrelevant from a criminal standpoint.

The procedure provides for a penalty equal to 0.5% of the value of undeclared cryptocurrencies for each year of the tax monitoring violation, and a substitutive tax equal to 3.5% of the value of cryptocurrencies in case of undeclared income.