Gift of Shareholdings: the exemption is preserved where control is maintained, including indirectly

In Ruling No. 152/2026, the Italian Tax Authority clarified that the contribution of shareholdings to a holding company and the subsequent disposal of a minority interest do not automatically result in the loss of the inheritance and gift tax exemption applicable to the intergenerational transfer of shareholdings. The decisive requirement is that the beneficiary continue to hold, directly or indirectly, legal control of the company for at least five years from the date of the qualifying transfer.

The case concerned a taxpayer who had become the owner of 100% of the shares in the family group’s parent company through several gifts received from his parents and a purchase. In particular, in 2025 his father gifted him a 35% interest in the share capital, thereby allowing him to increase an existing controlling interest and to benefit from the exemption provided for by Article 3(4-ter) of Legislative Decree No. 346/1990.

Before the expiry of the five-year monitoring period, the taxpayer intended to contribute at least 70% of the shareholdings to a newly incorporated personal holding company, applying the controlled realisation regime under Article 177(2) of the Italian Income Tax Code. Subsequently, he might dispose of a minority interest ranging between 20% and 30% of the operating company’s share capital to third parties.

The Tax Authority recalled that the relief under Article 3(4-ter) of the Italian Inheritance and Gift Tax Code is intended to facilitate the intergenerational transfer of family businesses. Following the amendments introduced by Legislative Decree No. 139/2024, the exemption applies not only where the beneficiary acquires control of the company, but also where the transferred shareholding increases an already existing controlling interest.

In order to avoid forfeiture of the relief, the beneficiary must retain, for at least five years, the legal control referred to in Article 2359, first paragraph, No. 1, of the Italian Civil Code, namely the majority of the voting rights exercisable at the ordinary shareholders’ meeting. By contrast, the beneficiary is not required to retain ownership of all the shareholdings received under the exemption. Contributions and disposals are therefore permitted, provided that, following those transactions, the beneficiary continues to exercise the control required by law.

In the case examined, the contribution of 70% of the shareholdings to the holding company does not result in the loss of the exemption, provided that the taxpayer retains control of the holding company and, through it, indirect control of the operating company until the end of the five-year period, which in the case at hand expires in June 2030.

The subsequent disposal of a minority interest to third parties does not automatically result in forfeiture of the relief either. For these purposes, it is irrelevant whether the shares disposed of are identified according to a FIFO or LIFO method, nor is it necessary to demonstrate that only the shareholdings received under the earlier gifts have been transferred. The decisive condition remains the preservation of direct or indirect control of the company.

The Tax Authority nevertheless clarified that, where shareholdings received by way of gift are disposed of within five years, Article 16(1) of Law No. 383/2001 may apply. Under this provision, the beneficiary must calculate the substitute tax on the capital gain as though the gift had not taken place, in order to prevent the gratuitous transfer from being used to reduce the tax burden arising from the subsequent disposal.

In summary, the contribution of shareholdings to a holding company and the disposal of minority interests do not jeopardize the inheritance and gift tax exemption, provided that the beneficiary retains, directly or indirectly, legal control for the entire five-year period. A disposal within five years nevertheless requires a specific assessment of the consequences for substitute tax purposes in relation to any capital gain.

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