With the decree coming new opportunities to pass on collections

In any event, the successor may legitimately choose whether to apply the 10% presumption in question or to overcome it by means of a special analytical inventory of the various assets or works of art, drawn up by a notary public in accordance with the rules of the Code of Civil Procedure (Art. 769 et seq. of the Code of Civil Procedure).

Finally, heirs or legatees may propose to the State to pay the inheritance tax through the transfer of assets of significant artistic, historical, archaeological, ethno-anthropological interest, identified on the basis of the rules of the Code of Cultural Heritage and Landscape (Art. 13 of Legislative Decree No. 346/90).

The procedure involves the submission of the proposal to the Ministry of Cultural Heritage, followed by an administrative phase to verify the conditions and value of the property. In the event of a positive outcome, the Ministry proceeds with the notification of the decree to the applicant within six months from the date of submission of the proposal. Finally, it is up to the applicant to notify the Ministry of Cultural Heritage of its acceptance of the proposed conditions.

Having said all this, it is usually suggested that the art collection be conveyed in a unified manner, otherwise it would lose its intrinsic value if it were fragmented.

The instruments that can be used for the purposes of estate and succession planning of works of art and collector's estates are wills, donations, foundations, simple partnerships and trusts.

Let's go in order, if the collector wishes to attribute specific assets to his heirs or legatees, he may draw up a will, dictating the provisions according to his will, attributing the collection to one or more heirs or legatees or to an entity (e.g. a museum) (however, it is necessary to take into account the legal rules protecting the so-called legitimated heirs).

Otherwise, in the absence of a will, the assets will be attributed in community of property to the heirs, following the rules of the Civil Code.

The collector may also decide to donate the collection or part of it in a spirit of liberality by drawing up a donation contract, which is a public deed.

In this case, the law requires a detailed description of the works with an indication of their value while, for tax purposes, gift tax applies. Two other legal instruments that meet the needs of management, protection, transmission and enhancement of an art collection are the foundation, the simple company and the trust.

Moreover, the legislative decree, approved by the Council of Ministers on 7 August, containing provisions for the rationalisation, inter alia, of inheritance and gift tax, and soon to be published in the Official Gazette,' explains lawyer Stefano Loconte, an expert on the subject, 'will introduce some interesting novelties.

First of all, there should be the possibility, under specific conditions, to transfer the shares of an ordinary partnership under the inheritance and gift tax exemption regime (Article 3(4-ter) of Legislative Decree No. 346/1990). This means that even if the ordinary partnership holds works of art or collectibles, the transfer of the partnership shares to the spouse or descendants will take place under the exemption regime.

Moreover, with respect to the trust, the transfer of assets and rights (including works of art and collectibles) by the settlor into the trust will not be subject to gift tax. Thus, in the event that the settlor/collector dies and the trust has a long duration, it may well be that those works and assets will never be attributed to the beneficiaries of the trust. Consequently, no gift tax will be charged on those assets that continue to remain in the trust.

In short, with the reform of the inheritance and gift tax, approved by the CoM in August, interesting opportunities open up regarding the legal structures that can be built (or improved) to effectively manage, protect, transmit and enhance an artistic collection.