The recent “Decreto Crescita” (Law Decree 34/2019) has modified the regime of impatriates with regard for professional sportsmen. The new discipline – contained in article 16, paragraphs 5-quater and 5-quinquies of Legislative Decree 147/2015 – refers to the “athletes, coaches, technical sports directors and athletic trainers” professionals belonging to the following italian sports federations affiliated to the CONI: FIGC and Serie A leagues, B and C (soccer), Fip (basketball), Fci (cycling) and Fig (golf). A recent project of Law actually under discussion in the Parliament, establishes, moreover, that the figure of the «sports worker» must be identified, without distinguishing between amateur and professional activities.

These athletes could enjoy a tax exemption – for five years – of 50% of the their labour income or (self-employment), instead of the 70% established for the other employees. They can also benefit from the extension for a further five years, in the presence of at least one minor child or in the event of purchase of a residential property after transfer to Italy (or in the previous 12 months) without the obligation to maintain the property throughout the facilitated period (which could cause some abuse).

When the new impatriate regime for sportsmen will apply?

Article 3 of Law 91/1981 establishes that “the athlete’s performance against payment is the subject of an employment contract”. This presumption makes it possible to include in the favour regime all sums for any reason received, including bonuses and prizes.

In Circular 17 / E / 2017 it was specified that the favour regime is also due to the income related to the activities performed abroad (for example for international competitions) of less than 183 days in the year and that in order to benefit the expatriates must submit a written request to the employer.

The sport contract is considered, instead, self-employment if at least one of the following requirements is met:

1. the activity is carried out in the context of a single sporting event or of several events linked together in a short period of time;
2. the athlete is not contractually bound to carry out preparatory or training sessions;
3. the service, although continuous, does not exceed eight hours per week or five days each month or 30 days each year.

In the latter case (which includes the sports services rendered in favor of the National Teams) the related incomes are considered assimilated to employment work.

The new regime has allowed the application of benefits also to professional athletes – thanks to the elimination of the requirements of high specialization and qualification previously requested – and has facilitated the purchase of athletes, Italian or foreign, coming from abroad.

It is not clear, however, why athletes engaged in other sports and other subjects operating in the sector – such as, for example, sports agents or attorneys – or in different sectors, can fully benefit of the 70% tax reduction.

However I think it would have been preferable to provide for all taxpayers concerned a reduction in the tax rate based on the increase in taxable income, as is the case, for example, in Spain in the context of the “new resident” discipline approved in 2014.

The new impatriate rules will also apply to the sponsorship compensations?

The application of the new impatriate regime places some interpretative difficulties in the presence of compensation for sponsorships and in the case of players’ loans.

The compensation coming from technical sponsors is attributable to the employment relationship if the sportsman sells to society the right of economic exploitation of its image.

Instead, compensation for sponsorships contributes to the formation of self-employment income if the activity is carried out with professionalism and habituality.

In both cases it is possible to benefit from the impatriaite rules. In particular, the condition of the prevailing exercise of the activity in Italy must be respected (and should, to this end, refer to the place where the sporting and photo or video shooting events take place).

Our firm can assist international clients, as we do, not only to relocate their residence to Italy, but also to opt for the new resident not domiciled tax package. Contact us with confidence, we have experience about this matter.