Italian Constitutional Court clarifies IRAP tax rules for professional associations

The Italian Constitutional Court has ruled that professional associations are not automatically subject to the Regional Tax on Productive Activities (IRAP) if the professional activity is not effectively carried out in an associative manner. In ruling no. 153, the Court addressed a challenge regarding potential unequal treatment between individual professionals and those operating within associations.

The Court clarified that the mere formal establishment of an associated studio is insufficient to trigger the tax. For an association to be considered a separate taxable entity, the profession must be concretely exercised in common by its members. If the professional activity remains personal, individual, and autonomous—even within an association—the tax exemption applicable to individual practitioners remains valid.

This decision, which originated from a case involving a notary association, establishes a general interpretive principle: the taxability depends on whether there is a functional and structural organization of shared professional activity rather than just the sharing of expenses and services.