I had short remote project with an Italian high school.
Now it's time for the payment and I am being told that since I'm not registered as a worker in Italy (i.e. I don't have an Italian P.IVA), they need to detract 8% for the IRAP tax and 20% for the IRPEF tax, together with having to pay 2Eur of a special stamp (the 'bollo').
I am registered as an independent in Switzerland and I normally just invoice the full agreed sum and I get that. Then, at the end of the fiscal year, I declare it and all is smooth. I worked with lots and lots of countries around the world and it always worked this way.
Is that normal that I have to pay another country's tax as if I wasn't an independent? If so, how will I proceed next year when I have to declare this work in Switzerland? Am I going to pay taxes twice on this or can I tell Switzerland that Italy already took its share?
Last time I filled the "FRONTESPIZIO" and the "MODELLO D", where I checked the "esonero" (and not "rimborso") quoting article 14 of the Convention between Italy and Switzerland.
This form should be given to the school (in my case it was the University where I was teaching); the school must be able to work with it (it should...) and then pay you in full. Otherwise they are obliged to apply the tax at source for the income generated on italian soil. If that happens, you can use the same form to ask for a reimbourse, but better do it right since the beginning.
How good is your Italian? I could help with the forms or the International Agreement if needed.
Yes, that's what I did. For the Modello D just the first half, if you manage to fill it before you get paid.
I left blank page 8 but I sent it anyways.
You probably have to attach at least one copy of identity document.
There was also a form from the University (my "employer") saying that I was attaching a Modello D. This extra form required proof of taxpaying in CH, I got it from the city Steueramt. Actually they were very kind, signing and stamping a foreign document, because "of course" the Uni was not accepting the Swiss residency confirmation, they wanted a foreign stamp on their own form
Your school might have a different workflow but you should in any case land on Modello D.
Si
Native speakers have sometimes the same experience... at some point there was even discussion over a bill that would mandate laws to be written in current italian. Swiss laws are IKEA instructions compared to Italian ones.
I've got a potential similar situation which could crop up next year:
a freelance project based in Italy (which if it goes ahead would be more than the 183 days allowance for "resident for tax purposes" rule). In discussion is around 9 months work required to be in Italy.
I live currently in Switzerland and my self employed company is based here too. I've done work for international clients before, but none for this proposed length of time.
My Swiss accountant has suggested I have a chat with an Italian tax expert, to help me understand the impacts. Has anyone got any contacts who I could approach for a chat?
Thanking you all in advance for any hints or advice!
you have two options, to pay taxes in both countries or to become tax resident in Italy for 2024. For the second option not only you might have to open the nightmarish Partita IVA but you might even have to ask for a visa depending on your passport.
This people provide a more detailed answer and offer consulting on the topic:
My not requested opinion is that you should find an arrangement so that your stay in Italy is lower than 183 days, in other words make 3 of the 9 months be remote working. Or shift the project by a few months so that is is done partly in 2024 and partly in 2025
An update regarding forms, for those finding this thread in the future.
This spring I was again in a similar situation and I found that some of the forms I linked above are not valid anymore, they have been updated by a new international version:
I had to print my form, sign it, send it (or upload to) the cantonal tax administration, get it back via regular mail, then forward it to the Italian "employer".
The same forms are also accessible through the Italian tax administration here in the page dedicated to Switzerland:
General when you go to foreign country for work, you must inform tax office by filling a form. For example in Belgium its called 'LIMOSA'. The 183 rule applies. After you must get a 'Business seat'. For one man company is considering that your establishment base is following you.
Many contactors tried to avoid that but after many years when tax officer find contractor's invoices in local company they send a really 6 figure penantly. Many families were destroyed.