In 2017 Italy Finance Law introduced a flat rate of tax of €100,000 aimed at attracting high net worth foreigners to reside in Italy.
The law states that new residents will pay only a flat lump sum tax of €100,000 in place of normal income tax.
As with any new incentive there is always a slow uptake of early adopters who seize the opportunity either through their own diligence or on the advice of expert professionals.
This recent article published by the The Guardian (a leading UK broadsheet newspaper) highlights, uptake in 2017 and 2018 was between 250 and 300. Some of these are classed as the ‘super-rich’ who are buying up expensive villas in regions like Tuscany.
The advantage that Italy has when it comes to attracting the ultra-high net worth of the world is that it is actually a very nice place to live! Unlike other jurisdictions that offer generous tax breaks such as Jersey or the Isle of Man, very few can offer a culture and lifestyle to rival Italy.
The regime also appeals to Italians looking to return home after extended periods overseas. It is quite common for Italian professionals working in the banking and other industries to develop their careers overseas but return home at some point. The law only requires that the individual has been residing outside of Italy for 9 of the previous 10 years irrespective of their nationality.
Along with the new flat tax of 7% for new residents there are lucrative incentives for expats to consider when deciding where to live.
If you’re considering moving to Italy and you think that paying a flat rate of €100,000 on your annual income would be beneficial then please contact us via the form below for a confidential call. We can assist with the correct tax advice and guide you with other areas of financial planning to optimise your situation.