Australian Digital Nomad: Visa and Operational Base in Florence
Hypothetical case study developed on the basis of our experience with international investors, intended to illustrate the type of operations that the law firm is able to structure and manage for clients with a similar profile. The scenario does not refer to a specific case actually handled.
An Australian software engineer aged thirty four, with an established career in the fintech sector and active contracts with companies in Sydney and Singapore, decides to relocate his operational base to Florence. A project that the Italian digital nomad visa has made possible since 2024, but which in practice raises issues that are far from trivial: Australian tax law taxes worldwide income if the individual remains an Australian resident for tax purposes, even in the event of a move abroad, unless it is possible to demonstrate the cessation of tax residence according to the strict criteria applied by the Australian Taxation Office; the digital nomad visa requires proof of a minimum income and adequate health insurance coverage valid in Italy; the social security position between the two countries, even in the presence of a bilateral social security agreement, must be carefully managed to avoid gaps in pension protection. A relocation that, without proper planning, risks generating double taxation and uncertainty regarding health and pension coverage.
The client
An Australian citizen aged thirty four, resident in Melbourne, software engineer specialized in digital payment systems with eight years of experience in the fintech sector. His professional profile was entirely structured in remote mode: a primary contract as an independent contractor with a fintech company based in Sydney, a second consulting contract with a startup in Singapore, and a portfolio of personal micro SaaS products generating recurring passive income through subscriptions.
The total annual income was well above the minimum threshold required for the digital nomad visa. The client had never resided in Italy nor did he hold European citizenship. The choice of Florence matured after extended periods spent in the city over the course of two years, motivated by the quality of life, the central location in Europe for reaching clients in Singapore with an intermediate time zone, and the presence of a well established international community in the technology sector.
The challenge
The relocation of an Australian professional to Italy through the digital nomad visa involves complexities that unfold across several levels: immigration, taxation and social security.
Immigration complexity
- The digital nomad visa, introduced into the Italian immigration framework by Decree Law 4 of 2022 converted into Law 25 of 2022 and made operational through the implementing decree of 29 February 2024, is a relatively new instrument in the Italian legal system: administrative practice is still in the process of consolidation and police headquarters offices have not yet developed a broad body of precedents.
- The minimum income requirement must be documented through contracts, invoices and bank flows relating to foreign clients. In the case of a freelancer with multiple clients and SaaS income streams, the documentation requires specific organization to demonstrate the continuity and adequacy of income.
- The activity of the digital nomad must be carried out remotely primarily for non resident entities. Any collaboration with Italian clients may create critical issues in relation to the requirements of the visa.
- The required health insurance must cover risks on Italian territory for the entire duration of the stay, with adequate coverage limits and without territorial exclusions.
Tax complexity
- Australia applies a tax residence principle based on a multi factor test consisting of the domicile test, the 183 day test, the superannuation test and the resides test, administered by the Australian Taxation Office. Simply leaving the country does not automatically interrupt tax residence, and the maintenance of a bank account, a lease or an address in Australia may be sufficient to preserve it.
- In light of the double taxation treaty between Italy and Australia, the allocation of taxing rights over self employment income and income deriving from digital activities requires a careful analysis of the applicable treaty provisions.
- The Italian flat tax regime may be applicable to self employment income, but the qualification of the different income streams such as contractor fees, consulting fees and SaaS income requires analysis in terms of the appropriate ATECO code and the eligibility requirements for access to the regime.
- Income sourced from Singapore introduces a third jurisdiction. Singapore adopts a predominantly territorial tax system and generally does not tax foreign sourced income, subject to certain exceptions. The treatment of income paid from Singapore to a resident in Italy must therefore also be analyzed under the Italy Singapore tax treaty.
Social security and insurance complexity
- Italy and Australia have a bilateral social security agreement, but its scope of application is limited and does not cover all forms of cross border self employment. The contribution position of the digital nomad must therefore be analyzed to determine the obligations in each country.
- The Australian superannuation system, the mandatory pension system, provides specific rules for individuals who cease to be tax residents. The management of the accumulated fund and the possibility of voluntary contributions from abroad require dedicated planning.
- The transition from Australian health coverage under Medicare to a private insurance policy valid in Italy and compliant with visa requirements must be managed without interruptions in protection.
The ItalyVisaInvestments.com solution
The law firm structured a process that began with cross border tax planning, a decisive element for the economic sustainability of the relocation, and then coordinated the immigration procedure and the operational establishment in Florence.
- Tax planning and income structuring
- Analysis of Australian tax residence and definition of the cessation strategy: mapping of all residence indicators such as bank accounts, leases, registrations and superannuation, and preparation of an orderly exit plan to satisfy the criteria of the Australian Taxation Office
- Analysis of the tax treatment of each income source under the applicable tax treaties: contractor income from Australia, consulting income from Singapore and passive SaaS income with multiple sources
- Assessment of access to the Italian flat tax regime: identification of the appropriate ATECO code, verification of turnover requirements and exclusion causes, and comparative simulation of the tax burden between ordinary taxation and the flat tax regime
- Structuring of invoicing and financial flows in order to guarantee full traceability of foreign payments and compliance with visa requirements, which presuppose activities carried out remotely mainly for non resident clients
- Immigration procedure
- Preparation of the digital nomad visa application at the Italian Consulate in Melbourne: collection and organization of income documentation including contracts, invoices from the previous twelve months, bank statements and Australian tax returns
- Identification and purchase of a health insurance policy compliant with legal requirements: full coverage on Italian territory, adequate coverage limits and inclusion of medical evacuation and repatriation
- Assistance during the consular phase and coordination with the Florence police headquarters for the conversion of the visa into a residence permit after entry into Italy
- Preparation of documentation for renewal: the residence permit issued after entry into Italy has an initial duration of one year and is renewable upon demonstration that income requirements continue to be met
- Operational establishment in Florence
- Assistance in the search for accommodation: identification of an apartment in the historic center with connectivity suitable for remote work and a registered lease agreement normally required for municipal residence registration
- Obtaining the Italian tax code, opening an Italian bank account and registration with the municipal registry office of the Municipality of Florence
- Opening of a VAT number under the flat tax regime and registration with the INPS Separate Management for Italian social security obligations
- Activation of utilities, orientation within the private healthcare network while awaiting any possible future enrollment in the Italian National Health Service, which is not automatic with the digital nomad visa, and logistical support for the relocation
The result
The operation developed over approximately three months, from the initial consultation to the operational establishment in Florence with an active VAT number and the first invoicing cycle completed.
- Digital nomad visa obtained from the Italian Consulate in Melbourne without additional document requests thanks to the completeness of the prepared income documentation
- Residence permit issued by the Florence police headquarters within ordinary processing times, with full compliance with the legal requirements
- Cessation of Australian tax residence obtained with the Australian Taxation Office, with orderly closure of all residence indicators and preservation of superannuation in non resident mode
- Flat tax regime activated with the appropriate ATECO code, with an overall tax burden potentially lower than the Australian income tax and Medicare levy previously paid in Melbourne
- Invoicing structure compliant both with visa requirements, primarily foreign clients, and with Italian tax law
- Health insurance coverage active without interruption following the termination of Medicare coverage in Australia
- Fully operational base in Florence with a time zone that allows management of Australian clients in the evening and Singapore based clients in the afternoon
The client was able to relocate both his professional and personal life to Florence while maintaining his client portfolio and benefiting from an optimized tax position and a regular and renewable immigration status.
What clients tell us in similar transactions
“Working remotely for international clients makes you think that relocating is just a matter of booking a flight and opening your laptop in another country. In reality, when I started looking into it, I realized that I risked paying taxes in both Australia and Italy at the same time, that the digital nomad visa had specific requirements regarding income documentation, and that my Medicare coverage could not be used for healthcare in Italy. The law firm put every piece in order: from closing my tax position in Melbourne to opening a VAT number in Florence, including the visa and the insurance coverage. Today I work from my apartment in Oltrarno, I pay less tax than before and my entire situation is fully compliant.”
ItalyVisaInvestments.com Team
Operations of this complexity are handled through coordinated work between the law firm’s departments, ensuring a single direction across all aspects of the engagement.
- Immigration Department, for the digital nomad visa procedure, consular coordination and management of the residence permit with the police headquarters
- International tax advisory, for cross border planning between Italy, Australia and Singapore, cessation of Australian tax residence, access to the flat tax regime and structuring of invoicing
- Operational relocation team, for accommodation search, municipal registrations, opening of the VAT number and logistical support for the relocation
Project management is entrusted to a single point of contact responsible for coordinating all professionals involved and for constantly updating the client on timelines and progress.
Do you have a similar situation?
If you are a professional working remotely for international clients and you are considering relocating to Italy through the digital nomad visa, it is essential to rely on a team capable of:
- managing the entire digital nomad visa process, from income documentation to coordination with the consulate and the police headquarters
- planning the cessation of tax residence in the country of origin, avoiding double taxation
- structuring the Italian tax position under the most advantageous regime, with full compliance with visa requirements
- identifying health insurance coverage compliant with legal requirements without interruptions in protection
- managing the entire operational establishment, from accommodation to the VAT number, from utilities to municipal residence registration
Our law firm assists international professionals in relocating to Italy through the digital nomad visa, with specific expertise in cross border taxation, immigration and operational establishment. A single point of reference for every phase of the operation.
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