33% drop in turnover for companies applying to obtain grants and calculation of the income parameter for professionals for the 600 and 1000 euro bonuses: a critical analysis of the legislation introduced by the Relaunch Decree.
THE May bonus have highlighted the dichotomy between entrepreneurs and professionals, the latter identified by the Minister Gualtieri as “people“.
The Minister underlined how professionals, as individuals, find refreshment for the loss of income in article 84 of Legislative Decree 34/2020 (the so-called Relaunch Decree), while companies find refreshment in Article 25 of the same decree, with the lost fund on loss of turnover.
Let’s try to understand the salient passages of the two articles.
Beneficiaries of the contribution established by Article 25 I’m
“the business and self-employed and agricultural income operators, holders of VAT number, referred to in the consolidated text of income tax approved by decree of the President of the Republic 22 December 1986, n. 917, hereinafter the consolidated text of income tax”
The rule does not place application restrictions on the basis of the legal form, individual or associated, but only of income category: company, self-employment, agricultural income, provided that they are obtained by the person holding a VAT number.
It is therefore not clear why in the second paragraph, among the subjects excluded in absolute terms are the recipients of the allowance referred to in article 27 of Legislative Decree 18/2020 converted by Law number 27/2020, i.e. the subjects earning work income self-employed registered under the Separate Account, as well as professionals registered with private pension funds.
The Illustrative Report is the key to understanding the words of the Minister and, above all, the regulatory inaccuracy:
“Self-employed income holders also include those identified in article 28 of law decree number 18/2020”
In other words, the government confuses individual entrepreneurs enrolled in the management of artisans and traders (i.e. the subjects referred to in art. 28) with self-employed income holders referred to in art. 53 of the TUIR, i.e. freelancers.
The standard is therefore written in an technical way and with random references: the first paragraph refers to the income categories provided for by the Tuir, while the Illustrative Report identifies the categories “of the bar taxman“, In the middle the taxpayers, or the professionals who, if registered only in the separate management, will be able to undertake a tortuous calculation of a decrease in income, while, if registered with a private pension fund, they will only be able to hope that the pressure of the trade unions will allow open a window to modify article 84.
The self-employed person “August” new mythological figure born during the lockdown, he also has the gift of ubiquity: for the months of March and April he is a person, and as such he is entitled to the flat-rate allowances of 600 euros for the drop in turnover, exactly like the “GS professionals“, Becoming, in May,”entity“(Non-person) so as to be entitled to the non-refundable contribution based on the drop in turnover.
THE professionals enrolled in the separate INPS managementon the other hand, for March and April they are entitled to the allowance € 600 on the basis of the drop in turnover, while in May they are entitled to the allowance on the decline in income for the two months March-April, with a calculation that could also test Job’s patience.
Taking note that the standards are, at present, these, we see the characteristics that differentiate them and the main traps.
33% drop in turnover as an essential requirement for non-refundable contributions
Non-refundable contributions impose a requirement: 33% drop in April 2020 turnover compared to the same month in 2019.
Turnover is calculated not on the basis of the invoices issued, but on the basis of the moment of execution of the operations.
It will not be a question of making a mere vertical sum of the invoices sent, but to verify the correct tax moment for each transaction for both 2019 and 2020.
Just to give an example, we think of the taxpayer who in April 2019 did not issue an invoice for a delivery and proceeded in July, repenting the operation, well that invoice must fall within the April 2019 count.
Another topic regarding turnover: it is a fact that does not reflect in the least the real business activity, so much so that for VAT purposes the reference parameter is the turnover.
The turnover is influenced by extraordinary operations such as sales of capital goods or internal transfers: if, for example, a subject had sold an instrumental asset with significant amounts in April 2019 and today had no reduction in core business revenues, it could still obtain the contribution, thanks to the drop in turnover, the only prerequisite.
The contribution is always and in any case due to subjects established after 01.01.2019 to the minimum extent:
- € 1,000.00 for individuals;
- € 2,000.00 for legal entities.
Bonuses 600 and 1000 euros: how they work allowances for people
Let’s move on to “people“, Or the professionals, to whom only”workers’ allowance“.
Article 84 states that:
“to freelancers with active VAT registration registered in the separate Management … not pensioners and not enrolled in other compulsory social security forms, who have undergone a proven reduction of at least 33 percent of the income for the second two months of 2020, compared to the income of the second two months 2019, an allowance for the month of May 2020 equal to 1000 euros is recognized”
The first evidence is that the professionals to whom the allowance is addressed are only those registered in the separate Management, the second is that it does not record the turnover, but the income, and the third that it is aindemnity released from the lost quantum, as it is fixed.
Without dwelling on issues relating to the different treatments of professionals, what gives a big surprise is the income requirement, especially for the observation period and the calculation method.
Unlike the lost fund thetime frame to be compared is the two-month period March-April 2019 with the same period 2020.
If on the one hand, income expresses real Covid damage, however, the method of calculation is singular: the standard provides for a precise quantification not perfectly compliant with the rules for direct taxes.
“To this end, income is identified according to the cash principle as the difference between the revenues and fees received and the expenses actually incurred in the period concerned and in the exercise of the activity, including any depreciation rates”
The professional, therefore, will be forced to reconstruct on the basis of the cash principle his remuneration / revenues, the expenses incurred and related to the activity and finally the depreciation rates on a monthly basis.
Just a brief observation: the rules contained in the Consolidated Income Tax Act, in particular article 54, provide for a series of limitations on the deductibility of some expenses, their parameterisation to the annual fees, their parameterisation to the total capital goods, etc.
Quite simply, the representation expenses are parameterised to the annual fees and the expenses for the vehicles have limited deductibility, which, from the literal tenor of the norm, would not be taken into account in the calculation.
Only in terms of equity should it be emphasized that the parameter of turnover is linked to the moment of carrying out the operation, while income is parameterised to the collection of a two-month period: the collections in March could be linked to operations that originated in the months previous, penalizing the taxpayer.
Far worse will be the position of the subjects who determine the income with a flat rate method: the rule is punctual and requires an analytical calculation that flat rates will never be able to provide, not keeping track of expenses or purchases of capital goods.
Once the professional has determined his / her drop in income, he / she can finally submit the request for compensation which will not be “lavished“(Horrible term used by the legislator in paragraph 11 of article 25) by the Revenue Agency, but by the INPS (like the other allowances).
The standard provides forwarding a request with self-certification of the requirements, whose timely verification will be requested from the Revenue Agency; after this validation the contribution will be paid.
At this point the question arises: what can the Revenue Agency check?
Should have knowledge of the collections, payments, the nature of the expense, capital goods and finally of the different types of depreciation: which obviously does not.
Without the validation of the Revenue Agency the indemnity cannot be paid; of the two one: either they will all be valid unless subsequent detailed verification in contradictory or it will be necessary to provide the data in advance using a special form. At the moment the procedure is not yet active.
The companies will follow a completely different procedure: the request for the lost fund will be sent via electronic procedure, to be defined, directly to the Revenue Agency, accompanied by self-certifications also in relation to compliance with anti-mafia legislation.
In this regard, criminal sanctions are provided for both false self-certifications, dedicated to anti-mafia legislation and penalties related to the undue perception of the contribution.
The contribution is quantified to a variable extent on the drop in turnover, but parameterized on the basis of revenues from the previous tax period:
a) 20% for subjects with revenues or fees not exceeding € 400,000;
b) 15% for subjects with revenues of € 400,000 and above and up to € 1,000,000;
c) 10% for subjects with revenues or fees of over € 1,000,000 and up to € 5,000,000;
In a nutshell, thanks to the contributions and bonuses we have discovered new subjects and new ways of determining income, as well as having clear knowledge that the legislator is not clear about the difference between turnover, turnover, revenues and, of course, between owners of self-employment and business income.