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Italian Flax Tax Regime for New Residents: All You Have to Know.

Discover Why Italy is the more trending option to pay less taxes.

Italy is keen to attract investment and human capital.

And is offering an interesting package named Italy Special Tax Regime.

Numerous Italy tax benefits are available to new residents:

  • High net worth individuals are being offered a Italy Special Tax Regime on foreign income.

     

    This tax break comes with an exemption from inheritance and gift tax on foreign assets, as well as fast-tracking of visas.

     

  • Workers can get a special tax break for earnings in Italy.

     

  • Foreign pensioners can pay a low flat tax on foreign income instead of personal income tax.

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But let's discover more deeply on Italy Special Tax Regime.

#1 Italy Special Tax Regime for High Net Worth Individuals (HNWIs)

In a bid to attract investment and human capital, Italy is offering a special package of incentives to HNWIs who become new residents.

If you are a HNWI and are planning to move because of Brexit or changes to foreign tax rules,

or simply because you are keen to enjoy “la dolce vita”,

this is the package for you.

Three things are on offer: a Italy Special Tax Regime for your foreign income, an inheritance and gift tax exemption, and fast-tracking of visas.

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What are main characters of New Italy Special Tax Regime?

As we mentioned in our dedicated page for this argument, The Italy flat tax is central to the package.

Regardless of the level of your foreign income, you can opt to pay an annual flat tax of EUR100,000,

+ and a lower amount of EUR 25,000 for each family member, defined very broadly as your:

— spouse
— children
— brothers and sisters
— parents and parents-in-law — sons and daughters-in law.

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Why Italy Special Tax Regime is so beneficial?

If you become a new resident of Italy and opt for the flat tax, you will benefit in two ways:

  • —  You will be able to remit foreign income to Italy without paying any additional tax.

  • —  You will be exempted from tax monitoring obligations (RW Form) and wealth tax payments.

    Essentially, you will be taxed in Italy only on your:

    — Italian income

    — capital gains from equity interests sold within five years of opting for the flat tax.

You can be also interested on: Investor Visa Italy: Why almost all Investor are moving to Italy

How can You be eligible for Italy Special Flax Tax Regime ?

You are eligible for the Italy Special Tax Regime if you have lived outside Italy for at least nine out of the 10 years before you move here.

To check that you qualify for the new package, it is best to apply for a tax ruling.

We offer this dedicated Services for you, in partnership with our Fiscal Advisors with 20+years experience on International relocation for HNWI.

In your application you must indicate where you used to live and where your foreign funds come from.

The tax authorities will check that you have not been tax resident in Italy for more than 12 months over the last 10 years.

They have 120 days to reply to your application.

How long can You benefits Italy Special Tax Regime?

Once you have opted for the flat tax, the arrangement will remain in place for a maximum of 15 years, unless you wind it up early.

The arrangement will terminate immediately if you do not pay the flat tax, or pay only part of it, by the annual deadline.

What about Inheritance and gift tax exemption ?

Any assets bequeathed or gifted by an Italian tax resident are normally subject to Italian inheritance and gift tax.

However, there are generous benefits for new flat-tax residents and you would be taxed only on assets and rights held in Italy.

So, you could pass on foreign assets free of tax

You can also have a Fast-tracking for Your VISA.

If you are a non-EU citizen and intend to stay in Italy for more than three months you have to apply for a visa.

Individuals who move to Italy without working here generally apply for an Elective Residence Visa.

This is one of our Service we provide, and you have a deep look on our dedicated Page.

To qualify for this type of visa, you must be able to show that you have both of the following:

— sufficient income to reside in Italy without working — a home in Italy.

After five years, on certain conditions, you can also apply for a European residence visa, which does not expire and allows you to move freely within the EU.

But.

To facilitate this visa procedure, Italy offers new tax residents a fast-track procedure if you (and your relatives) also intend to:

  • invest a minimum of EUR500,000 in an innovative start-up business

  • invest a minimum of EUR 2million in Italian government bonds for at least two years

  • invest a minimum of EUR 1million in an Italian company for at least two years

  • donate a minimum of EUR 1million for philanthropic purposes in a sector that assistsItalian economy (scientific research, education, etc.).

We already talked on this argument as related to Investor Visa Italy in our dedicated page here.

#2 Retirement in Italy Tax Benefits.

What are main characters of Italy Retirement Flax Tax Regime?

If you are a foreign retiree and decide to set up home in one of Italy’s attractive southern regions,

you will qualify for a six-year tax break and pay a substitute tax of just 7 percent instead of higher ordinary progressive personal income tax.

Like the scheme rolled out for HNWIs, this tax break is part of a drive to attract new residents.

This is a win-win situation: newcomers will enjoy la dolce vita along with a generous tax cut,

while the “Mezzogiorno” will benefit from the contribution these new arrivals can make towards its local economy.

How can You be eligible for Italy Retirement Flax Tax Regime ?

You will qualify for this new tax scheme,if you receive a foreign pension and:

 
  •  Become a tax resident of Italy (as defined in tax law) by moving to one of the approximately 2,300 towns or villages.

    These must be
     of Sicily, Calabria, Sardinia, Campania, Basilicata, Abruzzo, Molise or Puglia that have no more than 20,000 inhabitants;

  • Move there from a country with which Italy has a cooperation agreement (e.g. a double taxation treaty, TIEA or FATCA agreement);

  • Have not been a tax resident of Italy for a least five tax years before the year in which you opt for the scheme.

You can live in one of the most beautiful places in all world, and just pay 7% taxes on your foreign pension. 

 

One of the best ways to relocate to Italy is to enlist the help of Immigration Law Firm & experts. 

Choose well your expert: an Immigration Lawyer will be certainly the most prepared professional with highest skills.

Here are 5 main reasons:

  • Professional service providers know how to best position you for success
  • Due to their in-depth knowledge of the system, they know exactly what to do at each stage
  • Experience has given them an edge when it comes to compiling the necessary documents

If your time is valuable to you, then getting help from professional service providers is the best route for you.

Don't wait anymore!

Contact Us Now and Start Applying Immediately!

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We assist EU and non EU citizens with immigration and visa matters, as well as  residence registrations.

We offer a comprehensive service tailored to the needs of each case. All cases listed here

Our services include advice on immigration law, cross-border implications related to Italian Dual Citizenship, Investor Golden Visa Italy,(See also here for Investor Golden Visa benefits)  preparation of visa, permit to stay and residence applications, tax aspects, avoidance of dual taxation, (more informations also here)