Hyper-Amortization 2026: Guide to the Tax Incentive for AI and Industry 4.0

What is Hyper-Amortization

Hyper-Amortization is a tax benefit that allows for an increase in the tax-deductible cost of investments in technologically advanced capital goods. In practice, it involves a downward adjustment to the taxable base on which direct taxes (IRPEF/IRES) and IRAP are calculated.

The incentive replaces the previous Transizione 4.0 and 5.0 tax credits, introducing a more direct mechanism for reducing the tax burden over the entire amortization period of the asset.

Software and AI Solutions Eligible for Incentives

Annex V of the regulations specifically identifies the intangible assets eligible for the benefit. To qualify, software solutions must be:

• Interconnected with company IT systems through bidirectional data exchange

• Functional to production, logistics, or data-based decision-making processes

• Not intended for personal use or generic administrative/accounting puposes

Among the eligible AI solutions, we find:

• Computer Vision for automating visual analyses and quality control
  
• Predictive models for optimizing production processes
  
• Digital Twin for data-driven decisions in plant and asset managment
  
• Geographic Intelligence for territorial analyses and logistics optimaization
  
• RAG e LLM virtual assistants to break down information silos (based-in the case of solutions developed by Kode-on Mistral AI models, one of Europe’s leading companies in LLM development)
  
• Predictive maintanence and anomaly detection systems
  
• Generative AI and Large Language Models platforms
  
  

Who Can Benefit from the Incentive

All entities holding business income who make investments from January 1, 2026, to September 30, 2028, can access the Hyper-Amortization 2026. The benefit is aimed at both small and medium-sized enterprises and large companies, without size distinctions.

The Increase Rates

The intensity of the benefit varies based on the investment amount, according to the following table:

• 180% for investments up to 2.5 million euros

• 100% for investments between 2.5 and 10 million euros

• 50% for investments between 10 and 20 million euros

This means that, for example, a company investing €50,000 in an AI solution can tax-deduct €90,000 (€50,000 × 180%), achieving significant tax savings compared to the actual investment cost.

Additionally, in the case of projects involving certified energy savings, companies can access the enhanced rate of 220%.

Projects implemented with the Kode FactorAI framework, for example, can integrate systems for optimizing production processes, reducing process drifts and interruptions, and identifying energy waste.

The “Made in EU/SEE” Requirement: Current Situation

One of the fundamental conditions for accessing the incentive is that the goods must be produced in one of the Member States of the European Union or in States party to the Agreement on the European Economic Area. This “made in Europe” clause, introduced during the parliamentary process of the Budget Law, has generated some operational issues that are still under discussion in the implementing decree.

Status of the Implementing Decree

As stated by Giovanni Spalletta, Director General of the Department of Finance of the MEF, during the 9th National Forum of Accountants and Accounting Experts 2026, the implementing decree is ready in draft form, but the publication timeline remains uncertain.

The “made in Europe” clause is indeed creating diplomatic tensions with several producing countries that are protesting their exclusion from exports to Italy. Amendments to the energy bill decree have been proposed to extend the scope at least to G7 countries, but such an extension would still not be comprehensive, leaving out important producers like South Korea or Taiwan.

A government intervention to modify or abolish this clause cannot be ruled out, which would further extend the timelines for the definitive implementation of the measure.

The solutions developed by Kode are already compliant with this clause and will therefore meet the regulatory requirements in any case.

How It Works in Practice

The Hyper-Amortization mechanism involves four fundamental steps:

1. Preemptive Declaration: Kode provides the declaration attesting that the system is “Made in EU/SEE” (if it remains a condition)
2. Ex-Ante Communication to GSE: The company books the budget on the GSE portal, indicating the investment amount
3. Implementation: Kode integrates and delivers the solution, interconnecting it with the company’s existing systems
4. Ex-Post Communication: The company closes the process, and the accountant can apply the increase in the tax return
   

Kode Solutions Case Study

Kode solutions fully qualify as eligible intangible assets since they are interconnected with company systems (ERP, MES, CRM, PIM) with measurable functionality on processes and scalable, documented architecture.

Moreover, they meet the Made in EU/SEE requirement thanks to the use of models based on Mistral AI, one of Europe’s leading companies in Large Language Model development. This ensures full regulatory compliance for client companies accessing the incentive.

Solutions implemented with Kode’s FactorAI framework also support production process optimization, reduction of process drifts and interruptions, and identification of energy waste—features that could enable access to additional increases tied to energy efficiency.

Future Outlook

Despite uncertainties related to the publication of the implementing decree, Hyper-Amortization 2026 represents a significant opportunity for companies looking to invest in innovation and digital transformation. The incentive window extends until September 30, 2028, providing a sufficiently broad period to plan investments.

Interested companies can already begin evaluating technology innovation projects, pending the final definition of operational procedures and resolution of issues related to the goods’ origin clause.

For information on eligible projects and to verify solution compliance: 📧 info@kode-solutions.net