Tax residence in Italy: how it works for those relocating from abroad

More and more foreign nationals are considering Italy not just as a place to live, but also as a place to establish their tax residence. Whether retirees, investors, or high-net-worth individuals, understanding the criteria that define tax residence in Italy is essential to manage relations with the tax authorities correctly and to benefit from available tax incentives.

This guide explains how foreigners can acquire tax residence, how it differs from registered residence (residenza anagrafica), and what obligations come with relocating.

Criteria for tax residence: what Italian law states

Tax residence in Italy is defined under Article 2 of the Italian Income Tax Code (TUIR). For tax purposes, an individual is considered resident if, for the majority of the tax year (at least 183 days, or 184 in a leap year), even just one of the following conditions is met:

• Registration in the registry of residents (Anagrafe) in an Italian municipality
• Domicile in Italy (i.e., main center of personal or financial interests)
• Residence in Italy (i.e., habitual place of living)

Satisfying even one of these three criteria is enough to be considered a tax resident in Italy—unless the taxpayer proves otherwise.

A concrete example: an investor who moves to Tuscany, registers in the municipal registry, and manages their assets from there is considered fiscally resident in Italy, even if they own property or have economic interests abroad.

Frequently asked question: if I register in the Anagrafe, do I automatically become a tax resident?

Yes. Registration in the Anagrafe creates a presumption of tax residence, even if you are not physically present or habitually living in Italy. It will be the taxpayer’s responsibility to prove otherwise in case of a dispute.

Warning: many foreigners focus only on the 183-day rule, overlooking that merely transferring the center of interests or registering in the Anagrafe can trigger tax residency. A full understanding of the legal framework is crucial before settling in Italy.

The “center of vital interests,” also mentioned in double taxation treaties, can be decisive in cases of dual residence.

Tax obligations for those who become residents in Italy

Those who become tax residents in Italy are subject to worldwide taxation. Practically speaking, this means they must:

• File an Italian income tax return
• Declare any foreign-held assets, bank accounts, or investments (Form RW)
• Pay taxes on income earned anywhere in the world

What if I already paid taxes abroad?

Italy has signed numerous treaties to avoid double taxation. These agreements allow foreign taxes paid to be credited against Italian taxes, but applying them correctly requires careful attention and often professional assistance.

Anyone planning to move to Italy and establish tax residence should assess any potential overlap between the tax systems of the countries involved.

Tax benefits for new residents: opportunities and favorable regimes

To attract high-contributing individuals, Italian law offers several specific tax incentives. Among the most relevant:

• Flat tax for new residents: allows payment of a lump-sum substitute tax on foreign income. Note: Decree-Law 113/2024 raised the substitute tax from €100,000 to €200,000 on foreign-sourced income. This applies to individuals who transfer their tax residence to Italy after August 10, 2024, and who were not tax residents in Italy for at least 9 of the previous 10 tax years.
• Pensioners’ regime: for those relocating to municipalities in Southern Italy with fewer than 20,000 inhabitants. It offers a 7% flat tax on all foreign income for 10 years. The “Sostegni Ter” Decree (DL 4/2022) extended this tax break to foreign pensioners relocating to municipalities affected by the 2009 L’Aquila earthquake. The demographic limit of 20,000 residents—originally only for Southern towns—was expanded to all eligible municipalities, including earthquake-affected towns previously capped at 3,000 residents. This includes Camerino, Matelica, Tolentino, and Norcia, significantly broadening the scope of the benefit.
• Impatriate regime: for highly qualified workers who move or return to Italy from 2024, a 50% exemption applies to employment, equivalent, and self-employment income up to €600,000 per year. To qualify, one must maintain tax residence in Italy for at least four years, have not been a tax resident in Italy for the previous three tax years (or six/seven years if employed by the same corporate group), carry out most of their work in Italy, and meet high qualification or specialization criteria. The benefit lasts five years, with the possibility of a three-year extension for those who purchased a home in Italy by the end of 2023.

Taxation for foreigners in Italy can vary significantly depending on the chosen regime. Selecting the most appropriate one requires a personalized assessment of financial and income profiles.

Choosing the most favorable regime should always be done with careful planning, considering eligibility requirements, compatibility with international obligations, and the potential to combine with other benefits.

Transferring your tax residence to Italy is a strategic decision that requires legal clarity and long-term vision. Understanding the criteria for tax residency, clearly distinguishing it from registered residence, and carefully assessing tax obligations is essential to avoid risks and optimize your position.

In today’s global landscape, where personal and financial mobility is increasingly common, properly managing taxation for foreigners in Italy is key to protecting your interests and ensuring legal and fiscal continuity.

With an integrated view of taxation, international law, and wealth planning, every relocation can become a strategic opportunity. The experience of Italy Visa Investments in supporting international clients ensures secure and personalized guidance, always aligned with current regulations.