Navigating the Italian Tax System: A Guide to Special Regimes for New Residents

For individuals considering a move to Italy, the country offers several attractive tax regimes designed to attract foreign talent, high-net-worth individuals, and retirees. These programs provide significant tax advantages, making Italy a competitive destination for those looking to relocate. As of 2024, the main tax regimes for new residents include a revised "Impatriates Regime," a "Flat Tax for New Residents," a favorable "7% Flat Tax for Pensioners," and a special scheme for researchers and professors.

1. The Impatriates Regime (Regime degli Impatriati) - Updated for 2024

This regime is aimed at attracting workers with high skills and qualifications to Italy. Having undergone significant changes effective January 1, 2024, the new version of this popular scheme offers a 50% exemption on taxable income for up to five years.

Key Benefits:

• 50% Tax Exemption: For the first five years of Italian tax residency, 50% of your employment or self-employment income is exempt from taxation. This applies to income up to €600,000 per year.

• Increased Exemption for Families: The tax exemption increases to 60% if the new resident moves with a minor child, or if a child is born or adopted during the stay in Italy.

Eligibility Requirements: To qualify for the new Impatriates Regime, individuals must meet the following criteria:

• Prior Non-Residency: You must not have been a tax resident in Italy for the three years preceding the move. This period is extended to six or seven years for those who will be working for the same company or group they were employed by abroad.

• Commitment to Reside in Italy: You must commit to remaining a tax resident in Italy for at least four years.

• Work Predominantly in Italy: The work activity must be carried out for the most part in Italy.

• High Qualification or Specialization: This is a key new requirement. It can be satisfied by:

  • Holding a university degree or equivalent higher education qualification.

  • Meeting the requirements for highly specialized professions as defined by Italian law.

Application Process: Employees can apply by submitting a written request to their employer, who will then apply the tax relief directly to their payslip. Self-employed individuals can apply for the regime through their annual tax return.

Important Note on Previous Regime: Individuals who moved their tax residency to Italy before December 31, 2023, can still benefit from the previous, more generous version of the impatriates regime, which offered a 70% or 90% tax exemption under different conditions.

2. Flat Tax for New Residents (High-Net-Worth Individuals)

This regime is designed for high-net-worth individuals who transfer their tax residency to Italy. It allows them to pay a fixed annual tax on their foreign-sourced income, regardless of its actual amount.

Key Benefits:

• €200,000 Annual Flat Tax: A substitute tax of €200,000 is paid annually on all foreign-sourced income. This replaces the standard Italian income taxes (IRPEF) on that income.

• Exemption from Other Taxes: Beneficiaries are also exempt from inheritance and gift taxes on assets held abroad, and from wealth taxes on foreign real estate (IVIE) and financial assets (IVAFE).

• No Reporting Obligations: There is no requirement to report foreign assets in the Italian tax return.

• Family Extension: The regime can be extended to family members for an additional annual payment of €25,000 per member, which remains unchanged.

Eligibility Requirements: The eligibility criteria have not changed:

• Prior Non-Residency: The individual must not have been a tax resident in Italy for at least nine out of the ten years preceding their move to Italy.

Important "Grandfathering" Clause: This increase to €200,000 applies only to individuals who transferred their residence to Italy after August 9, 2024. Those who had already transferred their residency to Italy before this date can continue to benefit from the original €100,000 annual flat tax.

3. 7% Flat Tax for Pensioners

This special tax regime is aimed at encouraging retirees who receive a foreign pension to move to certain areas of Southern Italy.

Key Benefits:

• 7% Flat Tax: A flat tax rate of 7% is applied to all foreign-sourced income, including pensions, investment income, and capital gains.

Eligibility Requirements:

• Pension Recipient: The individual must be the recipient of a pension from a foreign source.

• Prior Non-Residency: You must not have been a tax resident in Italy for at least the five years preceding the move.

• Move to a Qualifying Municipality: You must establish your residency in a municipality with a population of no more than 20,000 inhabitants located in one of the following southern regions: Sicily, Calabria, Sardinia, Campania, Basilicata, Abruzzo, Molise, or Puglia.

Application Process: The option for the 7% flat tax is exercised in the annual tax return. The regime is available for a maximum of ten years.

4. Special Regime for Researchers and Professors ("Rientro dei Cervelli")

A highly favorable tax regime is available for researchers and university professors who move to Italy to carry out their activities.

Key Benefits:

• 90% Tax Exemption: A staggering 90% of their income from teaching and research activities is exempt from taxation.

Eligibility Requirements:

• Academic Background: The individual must hold a university degree or equivalent.

• Previous Foreign Activity: They must have been continuously resident abroad for at least the two previous years and have carried out documented research or teaching activities abroad at a public or private university or research institute.

• Work in Italy: They must carry out their teaching or research activity in Italy.

Duration: The benefit applies for six years from the year the individual becomes a tax resident in Italy. The duration can be extended under certain conditions, such as having children or purchasing a primary residence in Italy.

Application Process: Similar to the impatriates' regime, individuals can apply through their employer (the university or research institute) or directly in their annual tax return.

In conclusion, Italy offers a diverse range of tax incentives for new residents, each tailored to specific categories of individuals. From highly skilled workers and wealthy individuals to pensioners and academics, these regimes provide significant financial advantages, making the "dolce vita" an even more attractive prospect. Prospective new residents should carefully evaluate the eligibility criteria for each regime to determine which best suits their circumstances. Professional tax advice is highly recommended to navigate the application process and ensure compliance with Italian tax laws.

Last Updated: Sept. 28, 2025