SCI Principality of Monaco – Tax Residency

A situation I frequently encounter is that of partnerships incorporated abroad with partners who are tax residents in Italy.

With regard to “Société Civile Immobilière” in the Principality of Monaco, the Italian Revenue Agency’s circular dated 16.7.2015 no. 27 (§ 2.10) highlights the possibility of considering such companies as foreign-mislocated when it is deemed that the place of effective management is in Italy (leveraging the Italian tax residency of controlling partners).

Specifically, it points out that “this case arises, for example, when the gérant of the SCI (who could also be one of the partners if they effectively or legally hold this role) is a tax resident in Italy.”

The same principle applies to partnerships incorporated in any other jurisdiction, including U.S. Limited Liability Companies (LLC), which have become popular among digital entrepreneurs. They rely on the anonymity of ownership guaranteed by certain federal states (anonymity now outdated due to the introduction of the BOI) and on incorrect information received from various “company providers” and web gurus.