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Have you ever thought to spend your retirement age back to Italy?
Foreign retired citizens who decides to become “Italian tax resident” by transferring their residence in the South of Italy will be subject to 7% flat substitutive taxation for 9 years.



This is the Italian new 2019 fiscal law that gives the possibility to foreign retired non resident persons to transfer their residence in southern regions which are: Sicily, Calabria, Sardinia, Campania, Basilicata, Abruzzo, Molise and Apulia.

The aim of the new tax law is to encourage investments, consumptions and rooting in the small southern cities with less than 20.000 inhabitants by non-resident subjects, not only foreigners but also Italians, who receive income from a pension from foreign sources

New Italian Resident - eligible individuals

The regime can be chosen by individuals that have never been resident in Italy for tax purposes (according to art. 2 of the Italian Consolidated Law on Income Tax – TUIR) or at least for 5 years; they fall into the definition of the eligible ones.

Rules

1) Non residence status – citizen should have the status of non-resident in Italy for at least five tax years prior the starting the option;
2) Residence: non-resident citizens should “register” their residence in Italy and spend at least 50% of the fiscal year in Italy.
3) Checks The Italian Revenue Agency checks first information with fiscal authorities of the country where the person comes from;
4) Authorization The citizen receives the authorization for substitutive tax option;
5) Application The 7% tax option is applied in the tax declaration for the fiscal year in which the residence has been transferred and for the next 8 years.
In case of income revenues generated in different countries, the citizen can choose what are revenues subject to the Italian substitutive tax regime and what are subject the original (and ordinary) local tax regime.

As a matter of fact, the benefit tax regime can also be applied to third age Italian citizens living abroad in the last 5 years.


This is a summary of the new 7% substitutive taxation in Italy for foreign citizens willing to transfer their fiscal residence in the South of Italy and enjoy their pension.

Our tax consultants are ready to support you for additional information and to help you with your new Italian residence!

Contact our experts!