Undue Compensation and Contribution Irregularities

Undue Compensation and Contribution Irregularities

Criminal profiles, regulatory framework and defence criteria

Undue compensation represents one of the main risk areas in economic criminal law, standing at the intersection between tax regulation and contribution obligations. The offence becomes criminally relevant whenever the taxpayer or employer uses undue or non-existent credits in compensation, affecting the integrity of tax and social security revenues.

Regulatory Framework

The criminal regulation of undue compensation is set out in Art. 10-quater of Legislative Decree 74/2000, which punishes the use in compensation of undue credits and the use of non-existent credits. The provision also applies to compensations made through the F24 form.

Distinction Between Undue and Non-Existent Credits

Undue credits are credits that actually exist but cannot be used in compensation due to lack of regulatory prerequisites. Non-existent credits lack any legal or factual basis.

Contribution Irregularities and Criminal Relevance

In the social security context, undue compensation frequently manifests through the offset of INPS contributions with undue tax credits, use of non-existent credits to reduce contribution debts, alterations of contribution declarations, and misalignments between tax and social security positions.

Defence Method and Technical Approach

• Credit qualification: ascertain the nature of the credit used
• Verification of the regulatory prerequisites for compensation
• Reconstruction of the tax and contribution position
• Assessment of the subjective element and intent
• Review of precautionary real measures
• Coordination with tax and social security litigation

Areas of Application

• Undue compensation (Art. 10-quater Legislative Decree 74/2000)
• Contribution and declaration irregularities
• Disputes arising from tax and social security audits
• Use of tax and contribution credits in compensation