Are you aware of the Tax Benefits in Italy for foreign investors and workers? Our MGI Worldwide CPAAI member, MGI Vannucci & Associati explains how you can benefit!
Based in Lucca, Italy, MGI Vannucci & Associati shares news that the Italian government is encouraging foreign investors and workers to live, work, and do business in Italy, through the introduction of several legislative incentives.
Advantageous taxation for newly domiciled subjects
The 2017 Budgetary Law introduced a new, optional taxation regime for Italian nationals (and at their request, their family members) who have valuable assets around the world. Applications are open to those who transfer their own fiscal and administrative residence to Italy and have not been fiscally resident in Italy for at least 9 taxation periods over the past 10 years. Should you meet these requirements, you can benefit from:
- Substitute tax equal to € 100,000.00 per year for earnings from non-Italian sources. (Can be extended to family members at a cost of € 25,000.00 for each person).
- Exoneration from the obligation of declaring foreign financial investments and activities.
- Exemption from paying tax on foreign properties and foreign financial investments.
- Exemption from taxes on donation and succession on assets and properties held abroad.
Designed to attract new investors in Italy, securing an Investor Visa is a relatively easy procedure with less strict requirements than for an Italian Visa. This visa allows foreign investors to stay in Italy for more than 3 months if they wish to carry out an investment of:
- € 2 million in Italian government bonds.
- € 500,000.00 in an Italian limited company.
- € 250,000.00 in an Italian innovative start-up.
- € 1 million in a philanthropic initiative.
The visa lasts 2 years and can be renewed for 3 more years if the original investment or donation is maintained, after which time you can apply for a long-term permit of stay. After 10 years of permanent and legal stay in Italy, an individual is eligible to apply for Italian citizenship.
Elective Residence Visa
The Italian elective residency visa allows entry into Italy for a long period without having confirmed employment or another special visa. This is a long-term visa for foreigners who want to stay and travel in Italy more than 90 days per year. To qualify, you must meet the following criteria:
- Purchase or rent a house in Italy.
- Have a total income of at least € 32,000.00.
- Have regular and stable financial resources which are likely to remain steady in the future.
While this type of visa enables you to stay in Italy indefinitely, individuals who are granted it may have to pay taxes in Italy.
Fiscal benefits for non-EU pensioners
For non-EU pensioners who want to stay and live in Italy, the total taxation of foreign incomes is only 7% for a maximum of 10 years on pensions and also other incomes such as equity profits, real estate income, etc. To qualify, you must meet the following criteria:
- Hold a pension paid by a foreign state.
- Have your last fiscal residence in a state which has a taxation agreement with Italy.
- Not have had a tax residence in Italy in the previous 5 years.
- Obtain an entry visa, such as an investors visa, elective residence visa, etc.
- Declare the fiscal residency to a municipality with less than 20,000 inhabitants in one of the Southern regions (Abruzzo, Molise, Campania, Puglia, Calabria, Basilicata, Sardinia, Sicily).
- Reside in Italy more than 183 days per year.
How can MGI Vannucci & Associate help?
MGI Vannucci e Associati, thanks to its team of experts, can provide support and assistance in making these decisions. The firm can help you to evaluate all aspects related to your financial and tax situation. MGI Vannucci & Associati has many years of recognised experience in tax consulting in Italy for foreigners who want to move and stay in Italy and can advise you and establish the best tailor-made solution according to your needs.
MGI Worldwide CPAAI, is a top 20 ranked global accounting network and association with almost 10,000 professionals, accountants and tax experts in some 460 locations in over 100 countries around the world.