Author:
Sabrina Iannuzzi, Partner
Pomara Scibetta & Partners
Commercialisti – Revisori dei Conti
Via F.lli Gabba 1/A
20121 Milano, Italia
T: +39 02 784241 | F: +39 02 782464
W: www.pomarascibetta.it
Edited by:
Integra International
Grant Gilmour, B.Sc., MBA, CA, CPA Canada, BC, CPA USA, Az, GDipICL.Sc.
INTEGRA TAX WORLD NEWSLETTER EDITOR
E: [email protected]
Italy’s New Innovation Incentives
Italy is entering a new phase in its approach to supporting innovation and industrial investment.
For years, the tax credit system – particularly the well-known “Industry 4.0” framework – has been the primary tool to encourage businesses to invest in technology, research and development. However, from 1 January 2026, the landscape changed significantly: tax credits will gradually give way to a new hyper-amortisation regime.
At the same time, the R&D, Innovation and Design Tax Credit will remain in place, continuing to play a key role in supporting companies’ innovative activities.
So what should businesses expect?
R&D, Innovation and Design Tax Credit
The existing tax credit remains one of the most accessible and widely used incentives in Italy. It is available to all companies – including Italian subsidiaries of foreign groups – regardless of size or sector.
The incentive applies to:
- research and development activities
- technological innovation
- design and aesthetic development
The benefit is generally equal to 10% of eligible costs, with annual caps depending on the type of activity.
Eligible costs include:
- personnel
- depreciation of assets used in R&D
- outsourced research
- consultancy services
- materials
However, access to the incentive requires careful compliance:
- certification by a statutory auditor
- a detailed technical report describing the activities carried out
- proper documentation to support the innovative nature of the projects
In practice, the tax credit remains a powerful tool, but one that must be managed with a robust and well-documented approach.
New Hyper-Amortisation Regime
From 2026, Italy will shift from a “credit-based” system to a “deduction-based” incentive.
Instead of receiving a direct tax credit, companies will benefit from an increased tax depreciation base on qualifying investments. This translates into higher tax deductions over time.
The regime applies to investments made between 2026 and September 2028 and is available to all companies with production facilities in Italy.
Uplift Percentages
- 180% for investments up to €2.5 million
- 100% for the portion between €2.5 million and €10 million
- 50% for the portion between €10 million and €20 million
Eligible Assets
- AI systems and large language models (LLMs)
- GPU servers and high-performance computing
- private 5G networks
- software for sustainability and carbon footprint tracking
A noteworthy development is the removal of the “EU/EEA origin” constraint for most assets, allowing companies to source technology globally (with limited exceptions, such as certain photovoltaic components).
Planning Considerations for Businesses
This reform reflects a broader policy shift.
Tax credits provided an immediate benefit, often with a direct impact on cash flow. Hyper-amortisation, by contrast, spreads the benefit over time through higher deductions.
For businesses, this means:
- more emphasis on investment timing
- greater importance of financial planning
- a need to carefully assess the tax impact over multiple years
At the same time, the technical qualification of assets (e.g., interconnection requirements) will remain a crucial aspect.
Final Thoughts
Italy continues to offer a highly attractive framework for companies investing in innovation and digital transformation.
The coexistence of a stable R&D tax credit and a new hyper-amortisation regime creates opportunities – but also requires a more structured and forward-looking approach.
Businesses that plan early, document properly and align tax strategy with industrial investment decisions will be best positioned to fully benefit from these measures.
Disclaimer
This communication contains general information only based on collective research. Before making any decision or taking any action that may affect your finances or your business, you should consult a qualified professional adviser. No representations, warranties or undertakings (express or implied) are given as to the accuracy or completeness of the information in this communication, and none of POMARA SCIBETTA & PARTNERS, Integra International, related entities, employees or agents shall be liable or responsible for any loss or damage whatsoever arising directly or indirectly in connection with any person relying on this communication.
POMARA SCIBETTA & PARTNERS and Integra International, and their related entities, are legally separate and independent entities.
© 2026 Integra and POMARA SCIBETTA & PARTNERS
About the Author:
Sabrina Iannuzzi,
Partner
Sabrina graduated “cum laude” at L. Bocconi University, with degree in Economics and Business Administration and specialization in Finance. She is registered in the Milan Order of Professional Accountants and the Register of Auditors since 2009. She is a Statutory Auditor of important domestic companies.
Her practice includes tax and corporate advisory for ordinary and extra-ordinary transactions and international tax planning. She has also acquired experience in tax litigation and business valuation.
About Pomara Scibetta & Partners:
Established in 1950 as Studio Pomara, in 1975 the firm became Studio Pomara Scibetta as a partnership of professionals; in 2011 the firm became Pomara Scibetta & Partners and opened its new offices in the center of Milan.
Pomara Scibetta & Partners offers a wide area of professional advice on corporate and tax matters. The Firm is currently composed of corporate professionals and tax advisors that, by means of their respective specializations assist clients on several fields, in local contexts as in the international environment. The firm provides its services to small-medium and large-sized companies and also multinational groups.
Firm Profile:
https://integra-international.net/find-an-integra-firm/find-firm-profile/name/pomara-scibetta-partners/
Pomara Scibetta & Partners Website:
https://www.pomarascibetta.it/
