Italian taxpayers can now claim refunds or offsetting credits for IRAP paid on EU and EEA dividends following new procedures published on 22 April 2026. The measure implements a 2026 Budget Law and responds to an August 2025 Court of Justice ruling requiring Italy to align with EU parent-subsidiary rules. 

RF Report

The Italian Revenue Agency published Provision Prot. n. 123184/2026 on 22 April 2026, which outlines the formal procedures for claiming a refund or utilising compensation for the portion of Regional Tax on Productive Activities (IRAP) paid on dividends received from EU or EEA countries.

This measure was enacted to implement the 2026 Budget Law (Law No. 199 of 30 December 2025) and align national regulations with the Court of Justice of the European Union (CJEU) judgment issued on 1 August 2025.

Legal background and scope

The CJEU ruling (Cases C-92/24 to C-94/24) necessitated changes to the IRAP treatment of dividends for financial intermediaries and insurance companies to comply with the EU “Parent-Subsidiary” Directive.

  • Current treatment: For tax periods starting from 31 December 2025, 95% of dividends from EU or EEA countries (where an effective exchange of information exists) are excluded from the IRAP taxable base.
  • Refunds for prior periods: For periods prior to the 2025 change, taxpayers can reclaim the IRAP paid on the portion of those dividends that exceeded the 5% threshold.

The refund and compensation model

The Agency has approved a specific form titled “Modello per l’istanza di rimborso/compensazione IRAP per dividendi infra-UE o SEE”. The form is available electronically on the Italian Revenue Agency’s official website. The form must be signed (digitally or via handwritten signature with ID attached) and submitted through the “Consegna documenti e istanze” service in the reserved area of the Agency’s website.

Deadlines for submission deadlines

Requests should be submitted within the standard terms provided by Article 38 of DPR 602/1973. If the standard deadline (which must have been pending as of 1 January 2026) falls within 60 days of the Provision’s publication, the taxpayer has 60 days from the publication date to submit the form.

Option for compensation

Taxpayers have the option to use the reclaimable IRAP amounts—including accrued interest—as a credit for compensation (offsetting).

This credit can be used exclusively to pay the extraordinary contribution introduced by the 2026 Budget Law.

Entities that had already filed a refund request by 1 January 2026 can still opt for compensation by submitting this new model, which effectively replaces their previous refund request for the relevant amount.

Offsetting is performed via the F24 form using specific tax codes to be established by the Agency, and must be done through the Agency’s online telematic services starting from the 10th day of the month following the model’s submission.