First introduced in 2017, Individual Savings Plans are long-term “investment instruments” which aim to direct private investments towards small and medium sized Italian companies. If we go into further detail, Individual Savings Plans are also a “fiscal container” which come in a number of shapes and sizes: mutual investment funds, asset management, insurance policies or safe custody accounts.

A quick recap: how Individual Savings Plans work

Individual Savings Plans are reserved for natural persons: they cannot be undersigned by companies or other legal persons or entities. Each plan must be maintained for at least 5 years, cannot exceed 30,000 euros in investment and each saver cannot invest more than 150,000 euros in this type of financial instrument.

Asset management companies which offer and manage Individual Investment Plans must comply with certain legal limits:

• at least 70% of the invested amount must be directed towards companies based in Italy or businesses domiciled within the European Economic Space but with a permanent business establishment in Italy;
• at least 30% of this quota (21% of total capital) must be invested in instruments issued by companies which are not listed on the FTSE MIB of Borsa Italiana;
• the quota invested in a single issuer must not exceed 10% of the total;
• liquid instruments such as current accounts and deposits cannot exceed 30% of total invested capital.

The most advantageous and interesting part of Individual Investment Plans are guaranteed fiscal advantages. Indeed investing in Individual Investment Plans  means you avoid paying 26% of tax on capital gain, taxes on returns and capital incomes (if you maintain the investment for at least 5 years), as well as any inheritance tax.

Tendercapital Target Italy is an example of an Individual Investment Plan. (Click on the link to receive descriptive and promotion information on the Individual investment Plan Tendercapital Target Italy).

All the latest on Individual Investment Plans in 2019

The 2019 Treasury Law introduced some changes to all Individual Investment Plans taken out as of 1st January 2019. Indeed other restrictions on investment instruments and percentages of capital issued onto the market have been added. Specifically:

• new Individual Investment plans must invest at least 3.5% of the 21% of investment in non FTSE MIB companies in financial instruments (therefore shares and bonds) of small and medium sized enterprises listed on AIM Italia with less than 250 employees and a revenue lower than 50 million.
• an additional 3.5% must be invested in shares or venture capital fund shares (not private equity ones) resident in Italy.