_Ultimate guide to Italy's new flat tax rule

Italy has always been known for its unrivalled Mediterranean lifestyle, including gelato, polenta and The Tower of Pisa, but our inaugural report shows that the country appeals from a financial perspective, too, because of the introduction of a new flat tax rule. 

What is the new flat tax rule?

Income from Italy is subjected to tax rates of up to 43%. However, if you’re a resident non-dom, then income from a foreign country is protected from Italian tax, on the condition that a fee of €100,000 is paid annually. This can be extended to the resident's family at a cost of €25,000 per person.

What’s the difference between domicile, citizenship and residency?

Citizenship: One’s status as a member of a nation, with the rights and privileges that status carries with it.

Domicile: Where one lives with the intent to stay; a place where a person has a fixed dwelling with the intention of making it his/her permanent home.

Residency: Where one’s home is, or the building itself. It's usually a temporary status.

How to qualify?

The applicant must become an Italian tax resident under ordinary tax rules and must have either rented or bought accommodation in the country.

What are the terms?

You’ll be an Italian non-dom for up to 15 years. However, this status can be revoked either when an individual wishes or if they default on the annual payment.

Who can apply?

Anyone looking to move to Italy can apply, however, the person (of any nationality) must not have lived in Italy for the past nine out of 10 years, including Italian expats returning to the country.

Any other tax initiatives in Italy?

Yes, there are actually two. Firstly, in 2019, a new Retirees Regime was introduced. Aimed at foreign tax residents with foreign pensions, the scheme only applies to people moving to places with less than 20,000 inhabitants in the Southern part of the country.

Secondly, skilled employees heading to Italy for work can also benefit from an abatement of up to 70%. Applicants must plan to work in Italy for two years, but must not have been resident in Italy in the previous two fiscal years, before they transfer.

What other advantages are there to the Italian tax system?

There are many more advantages to the Italian tax system, but you’ll have to download the full report to find out what they are.

Download the Italian Tax & Lifestyle Report here for in-depth insight into Italy’s new flat tax rule: