Expenses for non-cohabiting mothers admitted to residential care homes will remain tax-deductible in 2025 as well

Tax-exempt also for the 2025 tax year, the reimbursement of expenses incurred by an employee for the admission of their mother to a care home, provided this is provided for under a corporate welfare scheme and even where the mother does not live with the employee. This clarification is set out in the response to tax ruling 163/2026 of 14 August, in which the Italian Revenue Agency outlined the changes to the tax exemption for welfare schemes aimed at employees’ family members in light of the Omnibus Decree (Legislative Decree 148/2026), which, by amending paragraph 4-ter of Article 12 of the TUIR, has corrected, with effect from the 2025 tax year (and therefore retroactively), the previous provision which would have regarded the requirement of the mother ‘living in the same household’ as essential for the purposes of benefiting from the tax exemption.

Please note that paragraph 2(f-ter) of Article 51 of the Tuir provides that the following do not form part of income from employment ‘sums and benefits paid by the employer to all employees or to categories of employees for the provision of care services to elderly or non-self-sufficient family members as specified in Article 12’. In this context, both the benefits provided by the employer (including through third parties) and the sums reimbursed to the employee may be considered exempt.

In the case submitted to the Agency for assessment, the issue centred on the amendments made to paragraph 4-ter of Article 12 of the Tuir by Legislative Decree 192/2025, which, with regard to family members eligible for the tax-free reimbursement provided for in Article 433 of the Civil Code – including employees’ parents – had introduced the requirement that they must live with the taxpayer (or receive family allowances). However, this provision, including the requirement in question, was repealed on 7 August by Legislative Decree 148/2026.

In light of these considerations and the new legislation, the tax authorities have therefore concluded that the reimbursement, provided for under a corporate welfare scheme and paid by the employer to the employee for expenses incurred in connection with hospitalisation and care for the mother at a residential care home (RSA), is to be considered tax-exempt even where the mother does not live with the employee.