Payroll and business related measures in Italy during the COVID-19 crisis

Payroll and business related measures in Italy during the COVID-19 crisis

April 08, 2020 || PayrollItaly

In order to cope with COVID-19, the Italian government has prepared a comprehensive package for companies, that affect the payroll services in Italy. There are three main areas, which are summarised in this article.

Special rules on job support

Three main takeaways from the job support part of the package:

Employers forced to suspend or reduce their working activities attributable to the Coronavirus are allowed to conduct the suspension, for a period of maximum nine weeks until August 2020.
Parents with children 12 years and under, can benefit from a 50% paid salary leave from work that doesn’t exceed 15 days (fractional or continuous).
A payment bonus of €100 to employees during the month of March within affected sectors, if they have a total income of less than €40 000. This regards employees that still go to their physical working place.
Special rules in support of liquidity through the banks

The following points are the main takeaways from the liquidity through the banks:

The state will guarantee up to 80% of bank loans for SMEs and micro-entrepreneurs that are affected by the crisis.
Banks will receive support from the CDP (Cassa Depositi e Prestiti S.p.A.) to provide loans more easily to companies that have suffered a reduction in turnover due to the crisis.
Micro, small, and medium-sized enterprises can ask banks to postpone payment until 30 September 2020.
Tax measures to support the company liquidity

Regarding tax measures the three main points are listed below:

Tax fulfillments (other than the tax payments and withholding tax to be withheld) expiring from 8th of March 2020 to 31st of May 2020 are postponed until the 30th of June 2020.
50% Tax cost cut for the sanitation of work environments and related tools. The maximum credit is € 20 000 per legal entity.
For tourism and hotel businesses and other harshly affected industries, the tax payments on employment income and similar payments due from the 2nd of March 2020 to the 30th of April 2020 are postponed to 31st of May 2020. The VAT for these sectors is also suspended in March 2020 and postponed until the 31st of May 2020.

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