Italy Tax Agency Clarifies Tax Debt Assumption, Payment for Member in Business Network

The Italian Revenue Agency Sept. 17 issued Letter No. 246/2025, clarifying the rules on tax debt assumption and compensation within business networks. The taxpayer, a legally recognized network of companies, planned to allow one member to pay another member’s tax debts using its own tax credits. The taxpayer sought clarification on whether this model would be a legitimate tax payment. Upon review, the Tax Agency clarified that: 1) the arrangement would constitute a prohibited tax debt assumption with compensation, under Article 17 of Legislative Decree 241/1997, given that compensation is only allowed between credits and debts of the same taxpayer; ...