After the enormous success of the 2015 tax reduction scheme for expats, in 2019 the Italian government decided to extend and boost it with a new great offer for new residents starting from 2020. Up to 90% tax break on your income!
Who can qualify?
The tax credit is available for individuals who:
- Were not Italian tax residents for the last 2 tax years;
- Will stay in Italy for at least two tax years
Employees must meet the following criteria
- Be resident abroad in the previous 2 tax years
- Stay in Italy for two tax years
If you have a college degree you do not need to stay in Italy for two years
Self employed individuals must meet the following criteria:
- Setup a partita IVA in Italy;
- Be resident abroad in the previous 2 tax years
- Stay in Italy for two tax years
This also works for new businesses in Italy, such as Airbnb, startups, and any other business activities.
How does it work?
Taxable income is reduced by 70% for 5 years.
Normally, if your taxable income is € 70,000.00 then your tax bill would be around € 23,500.00
But the tax credit allows you to pay taxes on just 30% of your taxable income, so your taxable income becomes € 21,000.00, and the tax payable is reduced to € 7,000.00.
Normally, if your taxable income is € 70,000.00 then your tax bill would be around € 23,500.00
But the tax credit allows you to pay taxes on just 30% of your taxable income, so your taxable income becomes € 21,000.00, and the tax payable is reduced to € 7,000.00.
Moving to the South?
If you move to the South of Italy in a qualifying region (Abruzzo, Molise, Apulia, Basilicata, Campania, Calabria, Sicily or Sardinia) you will only be taxed on 10% of your income.
Possible extension to 10 years
Should you purchase any residential property or claim a family dependant the regime is extended for further 5 years, meaning that you can benefit of this regime for 10 years.
How can we help you?
- Assessing if you qualify for the tax benefit;
- Providing support for the Migration process;
- Help you obtaining the required VISA
- Applying for the tax credit;
- Refunding any tax paid in excess during the previous years.
Do you want to stay updated with the latest Italian tax developments? Like our Facebook page!
