Circular no. 8/E of April 3, 2020 of the Italian Revenue Agency: guidelines on the tax measures provided for by the Decree «Cura Italia», relating to the bonus guaranteed to employees who continued to work at the place of work during the COVID-19 emergency.
The Inland Revenue, with Circular no. 8/E of April 3, 2020 (available here), has provided further clarification, in the form of questions and answers, on the tax measures provided for in the "Cura Italia" Decree, in order to describe the scope of the individual tax provisions contained in the emergency decree.
In the field of labor law, the aforementioned Circular has provided important practical clarifications on issues relating to the bonus awarded to employees who continue to work at the workplace.
As is well known, Article 63 of Decree Law no. 17 of March 18, 2020, provided for a bonus of €100 for employees who continued to work at the workplace during the health emergency. The amount is tax-exempt, therefore it does not contribute to the generation of income; it is related to the number of days of work carried out at the workplace and it is due to employees ̶ public and private ̶ who receive a total income not exceeding €40,000. The rationale of this provision is clearly aimed at supporting employees who have continued to work on site in March without being able to adopt smart or remote working as a preventive measure.
With reference to the management of employment relationships, in addition to the provisions of the regulation, the most important clarifications provided by Circular no. 8/E of 2020 are reported below:
- Calculation of days: in order to calculate the total number of days relevant for determining the amount of the bonus, the ratio between the actual hours worked in the month and the working hours as contractually agreed is taken into account;
- Days worked in smart working mode: the calculation of working days relevant for determining the amount of the bonus does not include the period of work carried out remotely, i.e. outside the ordinary place of work and/or the ordinary places where the work is traditionally carried out, even if functionally and structurally connected to them, through the use of computer and telematic communication tools;
- Field workers: the bonus is also to be awarded to those who have worked at clients' premises or in the field or at the company's branch offices (employees who have worked in smart working are excluded);
- Part-time workers: on the basis of the rule that relates the amount of the bonus "to the number of days of work carried out at the workplace", the Inland Revenue believes that, regardless of the type of employment agreement (full-time or part-time), the amount of the payable bonus shall be determined according to the period of work during which the employee actually worked at the workplace;
- Vacation or illness: in view of the rule's purpose, which aims at rewarding employees who have continued to work at the workplace, vacation or illness days shall not be taken into account;
- Criteria for determining the amount of employee income: for the purposes of verifying compliance with the threshold of €40,000 provided for by Article 63 of the "Cura Italia" Decree, only employee income subject to progressive IRPEF taxation shall be considered, and not that subject to separate taxation or substitute tax;
- Payment of the bonus: withholding agents automatically award the bonus starting from the salary paid in April and, in any case, by the end of the year. Consequently, the bonus at issue does not necessarily have to be granted with the salaries for the month of April 2020.