Italy: new guidelines on outbound dividend withholding tax

European Tax Newsalert

On July 8th, 2011, the Italian tax authorities clarified that the 27% Italian withholding tax rate does not apply to dividends distributed to certain qualifying corporations that are resident in an EU member state, Norway or Iceland, regardless of the earnings (post-2007 or pre-2008) from which the dividends are paid. In place of the 27% rate, either a 1.375% or a 1.65% rate will apply, depending on whether the dividend is paid from post-2007 earnings or from pre-2008 earnings.

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