Italy: Withholding tax rate increase on dividends paid to EU/EEA pension funds
LuxCSD1 informs clients that the Legislative Decree No. 148/2026 entered into force on 12 August 2026; Article 26 amends Article 27 of Presidential Decree No. 600/1973, increasing the withholding tax rate applicable to dividends paid to EU/EEA pension funds from 11% to 20%.
Effective
immediately
any dividend paid from 12 August 2026 will be taxed at 20% when paid to an EU/EEA pension fund.
Impact on clients
For relief at source applications
The One-Time Master Instruction (OTMI) required to obtain the preferential withholding tax rate by eligible EU/EEA pension funds has been amended to reflect the new applicable rate.
The certification requirements vary according to the following situations:
- The beneficial owner has already provided an O.T.M.I. before 12 August 2026. The O.T.M.I. can be used until its validity end date, therefore the beneficial owner is not required to send a new O.T.M.I. The reduced rate of 20% will apply automatically as of 12 August 2026, based on the existing O.T.M.I.
- The beneficial owner has not yet provided any O.T.M.I. or its O.T.M.I is no longer valid: the beneficial owner must provide the new O.T.M.I. that is reflecting the new reduced tax rate of 20%.
For standard refund applications
The applicable rate will depend on the date of the dividend payment and might result in refund rate of 15% for the payments taxed at 11% before 12 August 2026 or 6% for the payments taxed at 20% from that date.
The Domanda di Rimborso/Refund Claim has been amended to reflect this change.
The existing certification procedures for relief at source and standard refund remain applicable. Please refer to our Market taxation guide – Italy for full details.
Further information
Clients may contact the Tax Help Desk, Client Services or their Relationship Officer.
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1. LuxCSD refers to LuxCSD S.A., registered office at 42, Avenue J.F. Kennedy, L-1855 Luxembourg, registered with the Luxembourg Trade and Companies Register under number B-154.449.