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News for “controlled realisation” regime: more opportunities for group reorganisations

published on 11 June 2025 | reading time approx. 5 minutes

The “Irpef-Ires” Decree (Legislative Decree 192/2024 - the 'Decree') marks an important development in the tax regulation of extraordinary transactions, introducing simplifications for the corporate and tax planning of family businesses and groups. The Decree has introduced several key changes to the transfer of shares in the controlled realisation regime. These include requirements for foreign companies, the admission of 'capital loss' transfer and the easing of subjective requirements. Additionally, new criteria have been introduced for threshold verification when holding companies are involved.

In general, amendments have been introduced to Articles nos. 175, 176, 177 and 178 of the TUIR (Income Tax Consolidation Act). This article will summarise the changes in relation to transfer of controlling shareholdings, qualifying shareholdings and also shares in holding companies pursuant to Article 177 paragraphs 2, 2-bis and 2-ter of the TUIR.

What is meant by 'controlled realisation'?

Article 9 (5) of the TUIR governs the standard regulation of the transfer of shares. According to this article, contributions of assets, including shares, are treated as sales for consideration. However, for the purposes of calculating capital gain, the consideration obtained must be quantified on the basis of 'normal value'.

This provision is waived in the cases specifically covered by Articles 175 and 177 of the TUIR, which provide particular rules for calculating consideration received by the transferor. If certain conditions established by the law are met, these cases allow for the tax neutrality of transfer of equity interests, the so-called 'controlled realisation'.

What is new for transfers of controlling interests?

Paragraph 2 of Article 177 of the TUIR regulates 'controlled realisation' in the case of transfers of equity interests that allow the transferee to acquire control of a company.

Firstly, the Decree allows the 'controlled realisation' rule to be applied also to transfers of shares to non-resident companies, provided that the non-resident company holds an ordinary shareholders' meeting, under the rules of its home country. This provision is also applicable to transfers of qualifying shareholdings pursuant to Article 177 paragraph 2-bis of the TUIR.

Secondly, the Decree regulates 'capital loss' transfers. Previously, the tax effects of share transfer were much debated and still not clearly defined, when the holdings to be transferred were booked in the transferee's accounts at a lower value than their tax basis in the hands of the transferor.

Under the Decree, if the requirements of applicability of participation exemption regime are not met:

The negative difference between the value at which the participations are recorded in the transferee's accounts and their cost, as recognised for tax purposes in the hands of the transferor, is relevant for tax purposes for the transferor, essentially, to the extent of the negative difference between their normal value and their cost as recognised for tax purposes;
In any event, even should this negative difference not have any tax relevance, this does not result in disapplication of the controlled realisation regime in its entirety.

Thirdly, in the case of an increase in control, it is no longer provided that the regime is applicable 'by virtue of a legal obligation or statutory constraint'.

What is new for transfers of qualifying shares?

Article 177 para. 2-bis of the TUIR allows the application of the controlled realisation regime even when the transferee company does not acquire, integrate or increase control of the exchanged company pursuant to Article 2359 para. 1 no. 1 of the Italian Civil Code, provided that

the transfer relates to 'qualifying' shares;
the transferee is a “sole shareholder” or “family” company.

The Decree has relaxed the requirement for the transferee company to be solely owned by the transferor, providing that the controlled realisation regime also applies when the transferee is owned, not only by the transferor but also by their relatives pursuant to Article 5(5) TUIR (i.e., the spouse, relatives up to third degree and in-laws up to second degree).

The change is significant, as it allows the aggregation of minority shareholdings attributable to the same household.

However, as a result of the amendments, in order to benefit from this advantageous regime, the individual participations transferred must exceed the thresholds set forth in Article 177(2-bis), i.e., they must be shares that grant voting rights higher than 20percent or holdings in the capital higher than 25percent, with percentages reduced to 2percent and 5percent, respectively, for listed companies.

What is new for transfer of qualifying shares in holding companies?

The Decree then introduced a new para. 2-ter of Article 177 regulating the possibility of applying the regime of controlled realisation in the case of the transfer of qualifying shares held in holding companies.

First, it was clarified that for the definition of a holding company, it is necessary to refer to Article 162-bis of the TUIR, which qualifies as a holding company those companies that present in their statement of financial position a book value of their shareholdings (and other 'related' assets) higher than 50percent of total assets.

Secondly, an important change concerns how qualification thresholds are verified. The threshold must now be assessed not only for companies directly held, but also for those indirectly held through the holding company, taking into account any 'de-multiplication' However, some important clarifications have been introduced:

Indirect shareholdings are relevant for the verification only if they are held through companies controlled by the holding company, and these intermediary companies themselves qualify as holding companies ('sub-holdings');
It is sufficient that the exceeding of the minimum threshold is verified for those investees representing more than half of the book value of the shares;
A look-through approach must be applied whereby only participations held by sub-holdings, and not the sub-holdings themselves, are relevant.

In other words, the threshold verification is limited to first-tier non-holding investees, and only where the first-tier investee is, in turn, a sub-holding, must its first-tier investees also be considered, regardless of whether the sub-holding itself is considered.

Conclusion

The Decree has clarified the discipline governing business transfers and exchanges of shareholdings, with particular reference to shareholdings held in holding companies. This offers a valuable opportunity for thoughtful and strategic planning of company reorganisation, especially in family-owned businesses.