Relocation and Life in Italy

International Tax Consultancy

International tax consultancy supports those who have cross-border tax relations: individuals living in Italy but earning foreign income, or foreign residents operating in Italy. This service covers the verification of tax residency, the distinction between direct and indirect taxes, the application of tools such as tax credits and double taxation treaties, ensuring both regulatory compliance and tax optimization.

According to the worldwide taxation principle, a resident in Italy is taxed on all income, regardless of where it is generated, while a non-resident is taxed only on income sourced in Italy. Article 165 of the Italian Income Tax Code (TUIR) introduces the foreign tax credit mechanism, which allows taxes already paid abroad to be offset, thus avoiding double taxation. “Double Taxation Treaties,” signed with numerous countries over the decades, are often self-executing instruments that may even prevail over domestic rules if more favorable.

Boschetti International Law Firm provides international tax consultancy for foreigners, combining in-depth knowledge of legal sources with practical, transparent, and tailored solutions. With expertise and empathy, we guide clients through complex tax regimes towards clear, reliable, and efficient management.

International tax consultancy for foreigners

International tax consultancy for foreigners is crucial to understanding obligations, opportunities, and tax risks for foreigners residing, or with interests, in Italy. Anyone transferring residence to Italy or receiving Italian or foreign income must know how the TUIR defines tax residency.

Article 2 of the TUIR establishes that an individual is considered tax resident in Italy if, for more than half of the year (over 183 days), they are physically present in the country, registered in the civil registry, or maintain their tax domicile in Italy. If resident, they must declare all worldwide income; if not, only income generated in Italy is taxable.

Consultancy also evaluates special regimes such as the “impatriates regime,” which grants tax relief on income produced in Italy under certain conditions. For those transferring residency, there is the option of a flat substitute tax on foreign income, defined under Article 165(2) of the TUIR.

This service assists with the correct preparation of tax returns, reporting foreign income, calculating and applying foreign tax credits, and verifying applicable international treaties, all necessary to avoid mistakes, penalties, or unnecessary burdens. The Firm applies legislation, circulars, and official practices to guide clients toward personalized solutions.

International tax planning

International tax planning enables strategic management of taxation, complying with both national and international laws while minimizing tax burdens through legitimate tools. Key areas include:

Tax residence and domicile: assessment of residence criteria (Art. 2 TUIR) and tax domicile (DPR 600/1973, Art. 58);
Application of foreign tax credit (Art. 165 TUIR): calculation of the credit for foreign taxes definitively paid, provided the foreign income is included in the Italian taxable base;
Double Taxation Treaties: verification of treaties negotiated with many countries, in line with the OECD Model, which define residency criteria, income source, permanent establishment, and applicable taxation methods;
Elimination of double taxation: through exemption or tax credit, depending on the treaty.

Consultancy also includes comparative analysis between different jurisdictions, choosing the most efficient location for residence or income source, and verifying the legitimate use of treaties and special mechanisms.

Tax residence and double taxation

Tax residence is key to determining the scope of taxation. In Italy, an individual is resident if for most of the year (at least 183 days) they are physically present, registered in the civil registry, or domiciled in the country.

International treaties prevent double taxation by setting residence and source criteria, as well as tax relief methods (credit or exemption). Double taxation occurs when the same income is taxed both in the country of residence and the country of source. Article 165 TUIR allows for a foreign tax credit: foreign taxes can be deducted, within limits, from Italian taxes due. This mechanism requires that the foreign tax be definitive and the foreign income properly declared.

In complex cases, the Firm verifies whether a foreign permanent establishment exists, since in its absence foreign income may not qualify for credits, creating double taxation. The process includes interpretation of laws (TUIR, circulars), identification of applicable treaties, and calculation or planning of the most favorable relief strategy. The goal is to ensure compliance while keeping taxation sustainable.

Typical scenarios / Case studies

The typical scenarios have been developed by drawing on the most significant corporate immigration cases that the firm regularly handles, with the aim of creating structured, complex examples that help the reader navigate their own situation. The case studies, by contrast, illustrate individual real-life matters, anonymised to protect client confidentiality, presented with full factual and contextual detail.

Relocation

US professional chooses Italy: elective residence obtained and future planned

American professional obtains an elective residence visa while maintaining ties with the USA. Integrated assistance from legal strategy to property search..

Application completed in approximately 3 months without additional requests

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Business

US opera singer obtains work authorization in 7 days

American opera singer with contracts already signed with an Italian theatre. Self employment work authorization obtained on an urgent basis to meet professional commitments.

Work authorization issued within 7 days from submission of the application

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Real Estate

US client purchases property in Rome: secure transaction

American client assisted in the purchase of a property in Rome. Urban planning issues and contractual risks identified and resolved before signing, transaction completed through notarial power of attorney.

Purchase completed within one month, entirely managed remotely

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Business

American investor: from New York to a villa in Tuscany

Cross-border property transaction with full relocation service. Purchase of a high-end property, with tax status, residency and NHS registration handled remotely.

Complete relocation service, from property due diligence to handing over the keys

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Retirement

Canadian couple, retirement property in Puglia

From Toronto to the Itria Valley. Purchase of a farmhouse with cadastral issues, 7% flat tax on foreign pensions, elective residence visa and healthcare transition.

7% flat tax activated, cadastral issues resolved before the deed of sale

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Business

British entrepreneur, opening a business in Milan

Post-Brexit, a London-based tech entrepreneur establishes an operational headquarters in Milan. Immigration pathway as a non-EU national, company incorporation, and tax planning.

European operational hub established with self-employment visa successfully obtained

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Tax Planning

Swiss retiree: 7% flat tax regime in Southern Italy

A banking executive relocates from Zurich to Calabria. Management of the Swiss occupational pension pillar, Italy-Switzerland Tax Convention, and deregistration from the cantonal tax register.

7% flat tax activated on all foreign-sourced income

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Retirement

American couple: retirement project in Abruzzo with visa and flat tax

From Connecticut to Abruzzo. Elective residency visa, 7% flat tax coordinated with IRS and FATCA obligations, and transition from Medicare to the Italian NHS (SSN).

7% flat tax activated on Social Security and 401(k) pension income

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Relocation

German couple, from Munich to Tropea

Retired engineers from the Bavarian automotive sector. Multi-tier pension management, Italy-Germany Tax Convention, and the 7% preferential tax regime.

Three German pension pillars optimised with Italian flat tax

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Business

Startup tech: apertura filiale italiana per il mercato EU

A Bay Area SaaS company establishes a Milan headquarters. Innovative startup SRL, EU Blue Card for the team, transfer pricing, impatriates tax regime, and GDPR compliance.

Operational within 5 months, payroll cost −35% with impatriates tax regime

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Business

Fashion brand, representative office in Milan

Brand premium newyorkese apre presidio a Milano. Strutturazione per evitare stabile organizzazione, trasferimento direttrice creativa e gestione showroom.

Rischio stabile organizzazione prevenuto, presidio EU operativo

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Corporate

Manufacturing company, ICT transfers to Italy

Multinazionale giapponese trasferisce 3 figure chiave in Piemonte. Permessi ICT per manager e specialista, coordinamento consolare e regime impatriati per tutti i dipendenti.

3 trasferimenti completati in 4 mesi e mezzo, linea produttiva avviata nei tempi previsti

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How Boschetti International Law Firm can assist with international tax consultancy

Boschetti International Law Firm, directly or in collaboration with accountants specialized in international tax law, provides comprehensive and reliable services in international taxation. Our work is grounded in official legal sources (TUIR, DPR, treaties, circulars, practices of the Italian Revenue Agency, and the latest decrees) and aligned with client objectives. Support includes:

Verification of tax residence and domicile, with analysis of personal and time-related factors;
Identification of Italian and foreign income, assessment of reporting obligations, and application of foreign tax credits (Art. 165 TUIR) or special regimes (e.g., substitute tax or residence transfer option);
In-depth study of double taxation treaties, selecting those relevant to the countries involved and assessing their impact;
Tailored tax planning, including compliance with anti-avoidance measures (Legislative Decree 209/2023);
Assistance in complex cases, such as permanent establishments, consistent application of international rules, and protection from emerging double taxation.

The Firm provides strategic consultancy in international taxation, wealth management, and individual taxation, ensuring both compliance and effective tax management. Our approach is clear, personalized, and results-driven: reducing tax risks, avoiding penalties, maximizing benefits, and giving clients peace of mind.

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Via dei Gracchi, 151
00192 Roma – Italy

info@italyvisainvestments.com
Tel: + 39 – 06 889 21971

By appointment only
Day: Monday – Friday
Hours: 9:00 a.m. – 1:00 p.m. / 4:00 p.m. – 8:00 p.m.

Foreign pensioners in Italy: how the 7% flat tax regime works and who can access it

The 7% flat tax regime allows individuals receiving pensions from foreign entities to transfer their tax residence to a municipality in Southern Italy (with fewer than 20,000 inhabitants) and apply a 7% substitute tax on all foreign-source income for nine tax years.

Eligible municipalities are located in Sicily, Calabria, Sardinia, Campania, Basilicata, Abruzzo, Molise, and Puglia, as well as certain municipalities affected by the 2009 earthquake. The regime applies to all categories of foreign-source income. The option is exercised in the tax return, indicating the chosen municipality of residence.

Registered residence in Italy but tax residence abroad: is it possible and what does it imply?

This is a potentially risky situation. Registration in the Italian population registry creates a presumption of tax residence in Italy, with the obligation to declare worldwide income. This presumption can be rebutted by demonstrating that tax residence is abroad, including through registration with the AIRE or under applicable double taxation treaties, but the burden of proof remains on the taxpayer.

The Italian Revenue Agency may assess these situations based on objective factors. The presence of personal or economic ties in Italy may affect the determination of tax residence. It is therefore advisable to define one’s tax position in advance and prepare adequate supporting documentation, also considering tools such as advance rulings.

Health card for foreign nationals with elective residence: how to obtain it and what it covers?

Foreign nationals holding a residence permit for elective residence may enroll in the Italian National Health Service (SSN) on a voluntary basis, subject to payment of an annual contribution. Enrollment grants access to healthcare services under the same conditions as SSN beneficiaries, including general practitioners, specialist care, and hospital treatment.

The annual contribution is calculated based on total income and cannot be lower than €387.34. Alternatively, private health insurance may be used, provided it meets the requirements for residence in Italy.

New residents regime vs inbound workers regime: which is more advantageous and what are the requirements?

The new residents regime (Art. 24-bis TUIR) provides for a flat tax of €200,000 per year on all foreign-source income, regardless of the amount. The inbound workers regime (Art. 16 of Legislative Decree 147/2015) allows a reduced taxation on employment income produced in Italy. They are designed for different profiles.

The new residents regime is suitable for individuals with very high foreign income who do not work in Italy. The inbound workers regime is intended for those who move to Italy for work and have not been tax resident there in the previous two years. They are only partially compatible. The choice should be made before relocating.

Relocation: why are due diligence and real estate advisory crucial before purchasing?

Because the Italian real estate market presents specific risks that foreign buyers may not be aware of: unauthorized building works not regularized, outstanding mortgages, cadastral discrepancies, landscape restrictions, and undisclosed easements. Technical and legal due diligence carried out before signing the preliminary agreement allows these issues to be identified while it is still possible to renegotiate or withdraw.

Specialized real estate advisory for foreign clients also includes urban planning checks, verification of systems compliance, independent property valuation, and assistance in negotiations. Purchasing without these checks exposes the buyer to unexpected costs and post-acquisition disputes.