FACILITATIONS FOR START-UPS
Besides the ability to raise venture capital through on-line portals (equity crowdfunding), innovative start-ups are granted the following additional benefits:
- exemption from stamp duty and secretarial fees due for registration in the commercial register and from the annual fee at the chambers of commerce;
- tax benefits for directors, employees or consultants paid through financial instruments (eg. stock options): the amounts paid in the form of securities or option rights do not form part of the taxable income of the recipients;
- tax credit of 35% on “permanent” contracts for highly qualified personnel up to a maximum of € 200,000 per year for each firm;
- a twelve months extension on the so-called "rinvio a nuovo" of business losses (a stalling measure by which the Board acknowledges a significant loss but postpones the official recognition till the subsequent approval of the financial statements) and, in case of reduction below the statutory minimum, the possibility of postponing any decision on recapitalization to the end of the following year;
- innovative start-ups established in the form of S.r.l. (Ltd), are in some ways compared to S.p.a. (Plc), regarding, in particular, the self-determination of the rights granted to shareholders or the issuing of equity instruments;
- prohibited transactions involving their own shares are allowed if the transaction is carried out within the implementation of incentive plans granting equity instruments to employees, contractors, members of the administration, workmen or professionals (stock options and work for equity);
- power to issue financial instruments with economic rights, or even administrative rights, excluding the vote in the decisions of shareholders;
- support to internationalization through the services provided by the ICE and the Italian Desk for the promotion of national companies overseas and the internationalization of Italian firms;
- ability to recruit staff with fixed-term contracts lasting from a minimum of 6 months to a maximum of 36 months, with the possibility of adding 12 more months (reaching a total of 48 months);
- simplified, direct and free access to the Central Guarantee Fund, a government fund that facilitates access to credit through the granting of guarantees on bank loans.
FACILITATIONS FOR INVESTORS
Investors, individuals or companies, that in the four years period 2013-2016 will choose to finance the initiatives and projects selected by StarsUp may qualify for tax breaks:
- individuals have the right to deduct from their annual tax return an amount equal to 19% of the sum invested in the share capital of one or more innovative start-ups. The deduction percentage is raised to 25% for investments in innovative start-ups with social intent (as described in paragraph 4 of Article 25 of the Italian "Growth Decree") or in those who develop innovative high-tech products for the energy market. A limit is set on the maximum investment on which to determine the deduction, amounting to € 500,000 per year, and a minimum period of maintenance of the investment, amounting to two years.
- companies investing in innovative start-ups enjoy a favorable tax regime (with the exception of start-ups themselves) and are allowed to deduct from their taxable income an amount equal to 20% of the sum invested in the share capital of one or more innovative start-ups, raised to 27% when investing in innovative start-ups with social intent or in those who develop innovative high-tech products for the energy market. The maximum investment allowed is equal to € 1,800,000 per annum and, as well as for individuals, it is required to maintain the investment for at least two years.
WARNING - The viability of the “Growth Decree” is subject to the passing of a Ministerial Decree as well as to EU authorization (Article 108, paragraph 3, of the Treaty on the Functioning of the European Union).
The “Growth Decree” has been given the green light by the EU in December 2013, and the related Ministerial Decree has been signed in January 2014 but, as of today, it hasn't yet come into force. This is expected to happen within a few days, following the publication in the Official Gazette. The Decree will identify the application modalities by which the facilitations as described above will be effective.
We recommend that investors interested in the projects published on the StarsUp portal consult their own tax advisors for a correct identification of the benefits available at the time of the investment.