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How to benefit of the new Flat Tax System in Italy

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Italy’s Flat Tax System is an interesting fiscal initiative for new Residents from abroad. Let’s see how you can take advantage on the very competitive new Italy flat tax system.

Italy has approved the flat-tax for non-residentials with high net worth. It is meant to those who intend to transfer their residency to Italy, thus benefiting from a tax on foreign-produced income. The new Italian tax regime is very competitive, compared to similar programs in other countries, as the flat tax rate amounts to € 100.000,00 EUR only.

How to Apply
Taxpayers who are eligible may join the new tax system, when submitting the tax return, referring to the tax period when the residency was transferred to Italy or to the immediately following tax period. It is also possible to submit a specific prior request form to the Italian Revenue Agency.

Application extended to family members
The flat-tax system may also be extended to one or more family members who meet the requirements by means of a specific declaration in the tax return. In this case, the tax is 25,000 euros for each member of the family to whom the same system is extended.

When apply
You must apply within the deadline for submission of income declarations, even if the Italian Revenue Agency’s response to the prior request has not yet been received. The option is tacitly renewed yearly, while the effects cease within 15 years from the first fiscal period from the application.

The tax must be paid in a lump-sum
The payment of the € 100.000,00 flat-tax must be made in a lump-sum, for each period of effective taxation, by the due date for payment of the balance of the income tax.

This new law has been approved by the Italian government in 2017 and it seems quite convenient, for all those who’d like to move to Italy and save quite a lot of money in terms of taxes on high incomes.


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