A very attractive option for any person who wishes to establish residence in a favorable tax jurisdiction.

The tax incentive for new residents is intended for individuals who move their residence for tax purposes to Italy and consists in the possibility of paying a substitute tax on income generated abroad.

It is possible to opt for this benefit, which has a maximum duration of 15 years, regardless of nationality.

In fact, access is allowed both to foreign citizens and to Italians, provided they have been fiscally resident abroad for at least 9 of the 10 tax periods preceding the one in which the choice becomes effective.

Qualifying persons:

This tax regime is available for “newly resident” individuals in Italy, who (regardless of their nationality or domicile) have been non-tax resident in Italy for at least 9 years out of the 10 years preceding their transfer to Italy.

  • Individuals already resident in Italy can also benefit from it. In this case, also the tax period in which the residence for tax purposes in Italy has been obtained must be considered in the assessment of the time requirement.
  • The incentive regime may be also extended to the family members of these individuals.


High-net-worth individuals transferring their tax residence to Italy are enabled to apply a substitute tax to their foreign income, amounting to €100,000 for each fiscal year, in lieu of the Italian Income Tax (As a rule, Italian tax residents are subject to income tax on their worldwide income, to a 0.2% tax on the value of certain financial assets wherever located and to a 0.76% tax on the value of real properties situated in Italy and abroad). Therefore, this taxation represents an alternative to the application of the ordinary taxation and the option is valid for a period of 15 years. The election for the regime may be extended to family members through the payment on their foreign income of a substitute tax amounting to €25,000 per member. Taxpayers may access to the regime submitting an advance tax ruling to the Italian Revenue Agency or exercising the option for substitute taxation in their tax return.

By joining the res non dom regime, taxpayers and their family members enjoy the following advantages:

– exemption from the obligation to complete the RW framework relating to fiscal monitoring, on foreign assets and investments;

Qualified holdings that can generate capital gains taxable on an ordinary basis, if realized in the first 5 tax periods of validity of the option, do not exempt the new resident from the obligation to indicate in the RW framework the value of the foreign participation.

– exemption from payment of the tax on the value of properties held abroad and the payment of value tax on financial products, current accounts and savings books;

– inheritance (tax on successions) and gift tax limited to the assets and rights existing in the Italian State at the time of succession or donation, for open succession and donations made in the tax periods of validity of the option.


The tax package is integrated by a fast-track visa procedure for investors and their relatives.

According to the Res Non-Dom Regime, eligible taxpayers can choose which country or countries income to tax with the substitutive flat tax (the so-called “cherry picking” principle). Any income sourced in the “non-chosen countries” (if any) is excluded from the Res Non-Dom Regime (as well as the Italian sourced income) and, therefore, is subject to ordinary Italian taxation and will benefit from tax credit on taxes paid abroad (under ordinary limitations) and from relevant tax treaty protection (if any).

A € 100,000 substitutive tax corresponds to the ordinary taxation on approximately € 385,000 of financial income (without considering that the tax is also substitutive of wealth taxes on foreign financial and real estate assets). Assuming a return on investments of 2%, the burden of the yearly € 100,000 substitutive tax is equivalent to that associated to the ordinary taxation for an amount of foreign financial assets of approximately 13.9 €/mio (13,889,000 x 2% x 26% + 13,889,000 x 0,2% = 100,000).

Income from foreign sources can be remitted into Italy without any additional taxation.

Impatriate workers

Article 16 of Legislative Decree no. 147/2015, which allowed to tax 50% of the income produced in Italy for a period of 5 years for all workers who transferred their tax residence in the territory of the State. The favorable regime was applicable to two different categories of taxpayers; in particular workers who met the following conditions were entitled to the benefit:

(a) those who have not have been resident in Italy during the five tax periods preceding the transfer and undertake to remain in Italy for at least two years;

(b) those who carry out their activity mainly in Italy with a company resident in the territory of the State on the basis of an employment relationship established with that undertaking or with companies in the group;

c) those who hold managerial positions or possess the requisites of high qualification or specialisation.

Subsequent paragraph 2 of art. 16, then, extended the same tax benefits to the persons referred to in art. 2, paragraph 1, of Law no. 238/2010, or to citizens of the European Union, who had resided continuously for at least 24 months in Italy and who, although residing in their country of origin:

– were in possession of a university degree, had continuously carried out a work activity, whether employed or self-employed, or a business activity outside their country of origin and Italy in the last 24 months or more;

– have continuously carried out a study activity outside their country of origin and Italy in the last 24 months or more, obtaining a degree or post-graduate specialization.

Article 5 of Law Decree 30 aprile 2019, n. 34 has intervened on the percentage of exemption for income produced in Italy (previously set at 50%) which is raised to 70% with an undoubted advantage for taxpayers who can join the favorable regime. In addition, this percentage is raised to 90% for those who move their residence in the regions of Abruzzo, Molise, Campania, Puglia, Basilicata, Calabria, Sardinia and Sicily.

With respect to the duration of the benefit (fixed at 5 years), some assumptions exist in relation to the extension of the same.

This refers in particular to the possibility of applying the facility for a further 5 years:

– if the worker has a minor or dependent child, also in pre-adoptive foster care;

– if the worker buys a residential property in Italy after the transfer to Italy or in the 12 months preceding the same (the home can be purchased directly by the worker or by the spouse or children or by the cohabiting partner also in co-ownership).

In these cases, for the remaining 5 years, 50% of the income is taxable. If the worker has at least three children in the above conditions, the tax rate is set at 10%.

Finally, the new regime is applicable to persons who transfer their residence to Italy from 1 January 2020.

The decree now in force considerably simplifies the subjective scope of application which, as is well known, had generated considerable problems of interpretation (think, for example, of the case of the worker who returned to Italy after a posting abroad, a case which has been the subject of various interventions by the administrative practice).

In this regard, the benefit is applicable to taxpayers who transfer their residence to Italy pursuant to Article 2 of the TUIR and who:

– have not been resident in Italy in the two tax periods preceding the transfer and which undertake to reside in Italy for at least two years, and;

– work mainly in Italy.

It is specified that employees, self-employed persons and holders of incomes similar to salaried work (a category already previously included in administrative practice) may benefit and the new wording of paragraph 1- bis of Article 16 extends the scheme referred to in paragraph 1 and paragraph 2 of Article 16 to the persons who start a business in Italy, as from 1 January 2020.

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