IGD was the first company in Italy to obtain SIIQ (Società di Investimento Immobiliare Quotata) status and is still the only listed retail real estate company that qualifies as a SIIQ. There are five SIIQs in Italy today.
The Italian SIIQ regime is the same as the REIT (Real Estate Investment Trust) regime applied in many European countries and elsewhere with a view to encouraging potential shareholders to invest in real estate companies while benefitting from the resilience of the sector, as well as the liquidity of a stock market. REITs provide investors of all types with regular income, diversification and long term capital appreciation. REITs are listed on a national stock exchange in order to guarantee fair and systematic trading, as well as efficient disclosure of information.
Once it was clear that all the subjective, statutory and ownership requisites had been satisfied, in April 2008 IGD exercised the option to be treated under the new tax regime effective 31 December of the same year, as we also complied with the objective requirements by exceeding the minimum thresholds for assets and profits established under the law.
Since then we have always satisfied all the legal requirements and maintained our SIIQ status.
|SUBJECTIVE REQUIREMENTS||- Must be a joint stock company |
- Resident in Italy or one of the EU member states or one of the states that adhere to the European Economic Area Agreement for tax purposes
- Shares must be traded on a regulated market
|STATUTORY REQUIREMENTS||The corporate bylaws must include: |
- rules governing investments;
- limits on the concentration of investment and counterparty risk;
- limits on the maximum financial leverage permitted
|OBJECTIVE REQUIREMENTS||- Freehold properties must make up 80% of the real estate assets |
- Revenues from rental activities must account for at least 80% of the total income
|OWNERSHIP REQUIREMENTS||- The control limit: a single shareholder may not hold more than 60% of the rights to vote at ordinary shareholders’ meetings nor more than 60% of the dividend rights |
- The float requisite: at the time the option is exercised, at least 25% of the float must be held by shareholders with less than 2% of the rights to vote at ordinary shareholders’ meetings and 2% of the dividend rights. This requisite is not applicable to companies that are already listed.
|MANDATORY DISTRIBUTION||- Each year at least 70% of the income generated by exempt operations must be distributed as dividends.|
|INCOME TAX||- Income from the rental business is exempt from IRES (corporate income tax) and IRAP (regional business tax) |
- At least 50% of the capital gains generated by the sale of rental properties, interests in SIIQs or SIINQs, as well as in qualified real estate investment funds (viewed as exempt operations) must be distributed within two years of their realization
|ENTRY TAX||- 20% of capital gains on contributions|
The special SIIQ regime was introduced and governed by Law n. 296 dated 27 December 2006, as subsequently amended, as well as ministerial decree n. 174 dated 7 September 2007. Article 20 of Legislative Decree n. 133 dated 12 September 2014 (c.d. decreto “Sblocca Italia”), commented on in the Internal Revenue Agency’s Bulletin n. 32/E of 17 September 2015, also introduced a few changes to the SIIQ regime in order to simplify the rigid regulatory structure which had slowed development. More in detail, the decree redefined the ownership requirements for the SIIQ shareholders and granted greater flexibility in the management of investments. As a result of the decree, real estate investment funds and SIIQs are now subject to the same tax laws.