The Revenue Agency has clarified a doubt that arose regarding the obligation of shipowners who are natural persons to act as withholding agents
by Berardo Lanci*
In its Answer No. 10 of 15 July 2025, the Italian Revenue Agency clarified a doubt that had arisen regarding the obligation for shipowners who are individuals acting outside the scope of a business, art or profession to act as withholding tax agents. The issue was raised with particular reference to cases where the shipowner is at the head of an organised structure, such that it could be presumed to possess the typical professional skills of a withholding tax agent in relation to its employees.
This doubt is probably the result of confusion between, on the one hand, the legal employment relationships between the crew and the shipowners, and, on the other hand, the related tax obligations, which, however, serve different purposes and arise only if certain conditions are met. This, of course, given the slippery nature of specific issues, does not mean that it can be denied that it is preferable to obtain official clarification from the Revenue Agency in this regard.
However, first pointing out that, for tax purposes, Article 64 of Presidential Decree No. 600/1973 states that a withholding tax agent is someone who, by law, is obliged “to pay taxes on behalf of others, for events or situations relating to them and also as an advance payment… [by exercising, editor’s note] … recovery unless otherwise expressly provided”. This obligation is therefore imposed on certain persons identified by law, based on specific requirements established by the tax legislator, and without necessarily taking into account the legal situation linking the withholding tax agent to the substituted person.
The Revenue Agency clarifies that there are no withholding tax obligations for shipowners who are individuals acting outside the scope of their business, art or profession, excluding the possibility, even at the shipowner’s option
The provision on which the clarification provided by the Agency is based is contained in Article 23 of the same Presidential Decree No. 600/1973, which establishes that the following persons must act as withholding tax agents for income tax on employment: entities and corporations, partnerships, bankruptcy trustees, liquidators, condominiums and “individuals who carry on commercial enterprises… or agricultural enterprises, individuals who practise arts and professions”. With the question posed to the Revenue Agency, the applicant therefore raises doubts about the possible obligation to act as a withholding tax agent of the owner of a yacht, since – although an individual acting outside the scope of business, art or profession – “may employ a large number of employees (even more than 10) who perform highly professional activities with an organisation comparable to that of a going concern”.
Although the crew employed by the shipowner is organised as a business entity, there is no obligation for the shipowner to withhold tax if he acts outside the scope of his business, art or profession.
The Revenue Agency therefore clarified the question by pointing out that Article 23 above strictly identifies the persons who act as withholding tax agents in relation to income from employment. Thus, a shipowner who is an individual acting outside the scope of commercial business activities cannot, at their option, act as a withholding tax agent concerning emoluments paid to hired crew members.
It is therefore clear that the factual situations highlighted by the applicant, although worthy of consideration, did not lead the Revenue Agency to depart from the literal meaning and hence to consider that the shipowner, as an individual, outside of commercial activity, could act as a withholding tax agent concerning the emoluments paid to his employees. The tax obligation to declare and pay income tax due in relation to the employment activity carried out, therefore, remains exclusively with the latter. Moreover, the list set out in the provision mentioned above must clearly be considered exhaustive, if only because, for mandatory purposes, many other provisions of law refer generically to “the persons referred to in Article 23”, imposing on the latter a series of obligations and formalities that cannot always be fulfilled and implemented by those who are not required to do so by law, including, but not limited to, procedural issues. An extension of the category of persons who may act as withholding tax agents would, in addition to the above, therefore lead to a high risk of procedural confusion
(Obligations of the withholding tax agent – Barchemagazine.com – Excerpted from Barche, December 2025)
