--- title: "Italy tax for new residents 2026: rates and regimes" url: https://settleanywhere.com/countries/italy/tax/ lang: en updated: 2026-10-12 --- # Italy tax Tax residence: At least 183 days in tax year (184 days in leap years). 4 special regimes for new residents: Substitute tax for new residents on foreign-source income, Impatriate workers regime, 7% substitute tax in southern municipalities and Flat-rate regime for self-employed and sole traders. Checked against official sources on 12 Oct 2026 [Change log](https://settleanywhere.com/changes/) ## Tax residence - At least 183 days in tax year (184 days in leap years) · A person who for most of the year (at least 183 days, 184 in leap years) satisfies at least one residence condition is resident in Italy for income tax. - Residents are taxed on income wherever produced; non-residents are taxed only on Italian-source income. ## Special regimes for new residents Special regime ### Substitute tax for new residents on foreign-source income (Art. 24-bis TUIR, flat tax) Tax relief Foreign-source income: Flat lump sum EUR 300,000 **Details** - Who: Not resident in Italy for at least nine of the ten tax periods before the option starts - Limit: €300k/yr ≈ $335k Optional annual lump sum replacing Italian tax on foreign-source income: EUR300,000 (≈ $335,000) for people transferring residence from 1 January 2026 (Law 199/2025), EUR200,000 (≈ $223,000) for transfers between 11 August 2024 and 31 December 2025, EUR100,000 (≈ $112,000) for earlier transfers; the effect ends after fifteen years. (sources 1, 2, 3) #### Taxed on Foreign-source income of eligible individuals who transfer residence to Italy; Italian-source income is taxed under ordinary rules. #### Who it applies to - Not resident in Italy for at least nine of the ten tax periods before the option starts. - The option is made in the tax return for the transfer year or the next one; an advance ruling request (interpello) is possible. - Family members who meet the same residence test can be added at EUR50,000 (≈ $55,900) each a year from 1 January 2026 (EUR25,000 (≈ $27,900) for earlier cohorts). - The option can exclude chosen foreign states, whose income is then taxed under ordinary rules with a foreign tax credit. #### Exclusions - Italian-source income stays under ordinary taxation. - Gains on substantial participations (Art. 67(1)(c) TUIR) realised in the first five option periods are outside the lump sum. - Revocation or loss of the option (for example for non-payment) bars a new option. #### Limits - EUR 300,000 a year (≈ $335,000) · Main taxpayer: residence transferred from 1 January 2026 (Law 199/2025 art. 1 paras. 25-26 raised EUR200,000 (≈ $223,000) to EUR300,000 (≈ $335,000)) - EUR 50,000 a year (≈ $55,900) · Per family member, residence transferred from 1 January 2026 - EUR 200,000 a year (≈ $223,000) · Main taxpayer: residence transferred 11 August 2024 to 31 December 2025 - EUR 25,000 a year (≈ $27,900) · Per family member, transfers before 1 January 2026 - EUR 100,000 a year (≈ $112,000) · Main taxpayer: transfers before 11 August 2024 #### Tax residence The cohort is set by the date residence is transferred to Italy. The lump sum is paid in one instalment by the balance-payment deadline, and the option lapses after fifteen tax periods. #### Visas No visa is needed for the election; it is a tax option. #### Other taxes Italian VAT, social contributions and local taxes are separate. Checked against official sources on 10 Oct 2026 [Change log](https://settleanywhere.com/changes/) Special regime ### Impatriate workers regime (Art. 5 D.Lgs. 209/2023) Tax relief **Details** - On: Employment-type and professional income produced in Italy up to EUR600,000 (≈ $670,000) per year - Limit: €600k/yr ≈ $670k Only 50% of qualifying employment and self-employment income produced in Italy, up to EUR600,000 (≈ $670,000) per year, counts toward taxable income; 40% for workers with a minor child. (source 4) #### Taxed on Employment-type and professional income produced in Italy up to EUR600,000 (≈ $670,000) per year; 50% of it (40% with a minor child) enters taxable income and is taxed at ordinary IRPEF rates. #### Who it applies to - Commit to Italian tax residence for at least four years and not have been resident in the three preceding tax periods. - If the worker keeps the same employer or group as abroad, the required time abroad is six periods (seven if previously employed in Italy by that group). - Work performed mostly in Italy and meet high-qualification or specialisation requirements of D.Lgs. 108/2012 and D.Lgs. 206/2007. - Applies from the transfer year and the four following periods; lost with recovery if residence ends before four years. - The 40% inclusion applies when the worker moves with a minor child or has or adopts one during the regime, and the child is resident in Italy. #### Exclusions - Income above EUR600,000 (≈ $670,000) per year receives no reduction. #### Limits - EUR 600,000 a year (≈ $670,000) · Annual income cap for the 50% (or 40%) inclusion #### Tax residence Benefit period five tax periods; three extra periods apply to people who moved their registered residence in 2024 and own a home in Italy used as their main residence that was bought by 31 December 2023 and within the 12 months before the move. #### Visas Independent of visa type. #### Other taxes Social contributions and VAT are separate. Checked against official sources on 12 Oct 2026 [Change log](https://settleanywhere.com/changes/) Special regime ### Foreign pensioners regime: 7% substitute tax in southern municipalities (Art. 24-ter TUIR) 7% tax Foreign-source income: 7% flat on foreign-source income **Details** - On: Foreign-source income of any category 7% substitute tax on all foreign-source income for each of nine tax periods for foreign pension recipients moving to eligible southern municipalities; the population cap is 30,000 inhabitants from 7 April 2026 (previously 20,000). (sources 5, 6, 7) #### Taxed on Foreign-source income of any category. #### Who it applies to - Receive pension income paid from abroad and transfer tax residence to a municipality in Sicilia, Calabria, Sardegna, Campania, Basilicata, Abruzzo, Molise or Puglia with no more than 30,000 inhabitants, or to a municipality of 30,000 or fewer affected by the 2009 or 2016 earthquakes. - Not have been tax resident in Italy in the five tax periods before the one in which the option takes effect. - Move from a country that has an administrative cooperation agreement on tax matters in force with Italy. - Option valid for nine tax periods; municipal population is read from ISTAT data at 1 January of the year before the first period. #### Exclusions - Regions and municipalities outside the list are not eligible. #### Tax residence Option is exercised in the return for the transfer year. #### Visas Independent of visa type. #### Other taxes Italian-source income and local taxes remain under ordinary rules. Checked against official sources on 12 Oct 2026 [Change log](https://settleanywhere.com/changes/) Special regime ### Flat-rate regime for self-employed and sole traders (regime forfetario) 15% tax **Details** - Who: Revenue or fees in the previous year not above EUR85,000 (≈ $95,000) - Limit: €85k/yr ≈ $95k A single 15% substitute tax on a flat-rate taxable profit for self-employed people with revenue up to EUR85,000 (≈ $95,000); 5% for the first five years of a genuinely new activity. (source 10) #### Taxed on Revenue or fees multiplied by the profitability coefficient of the activity, less compulsory social contributions; the 15% replaces income tax and regional and municipal surtaxes. #### Who it applies to - Revenue or fees in the previous year not above EUR85,000, (≈ $95,000) and no more than EUR20,000 (≈ $22,300) gross spent on employees and collaborators. - Residents in Italy, or residents of an EU or EEA state that exchanges information who earn at least 75% of their total income in Italy. - The 5% rate applies for five years if no business or professional activity was carried on in the previous three years and the activity is not a continuation of employment or earlier work. #### Exclusions - People using special VAT regimes or other flat-rate income regimes. - People whose work is mainly for a current or recent (two previous years) employer. - Employees with employment income above EUR30,000 (≈ $33,500) in the previous year (EUR35,000 (≈ $39,100) for 2025 and 2026). - Anyone who partners in certain companies or controls limited companies with related activity. #### Limits - EUR 85,000 a year (≈ $95,000) · Revenue or fee ceiling to enter and stay in the regime (leaving the next year if exceeded) - EUR 100,000 a year (≈ $112,000) · Above this the regime ends in the same year and VAT is due from the transaction that crosses it - EUR 20,000 a year (≈ $22,300) · Maximum gross spending on employees and collaborators #### Tax residence Non-residents are excluded, except residents of EU and EEA states that exchange information and who earn at least 75% of total income in Italy. #### Visas Independent of visa type; relevant to holders of self-employment permits who are tax resident in Italy. #### Other taxes Social contributions and VAT rules are separate. Checked against official sources on 11 Oct 2026 [Change log](https://settleanywhere.com/changes/) ## Standard rules and foreign-source income Standard rules ### Italian personal income tax (IRPEF) ordinary rates 2026 Worldwide income **Details** - On: Worldwide income of residents, net of deductible charges - Limit: €28k/yr ≈ $31k Residents are taxed on worldwide income, including foreign-source income: 23% up to EUR28,000, (≈ $31,300) 33% from EUR28,000 (≈ $31,300) to EUR50,000 (≈ $55,900) (reduced from 35% by the 2026 Budget Law), and 43% above EUR50,000 (≈ $55,900); non-residents are taxed on Italian-source income only. (sources 8, 1, 9) #### Taxed on Worldwide income of residents, net of deductible charges; regional and municipal surtaxes are additional. #### Who it applies to - Italian tax resident: for most of the tax year (at least 183 days, 184 in leap years) the person has habitual residence or domicile in Italy, is physically present there, or is registered in the resident population register. #### Exclusions - Taxpayers with total income above EUR200,000 (≈ $223,000) do not keep the benefit of the lower second rate. #### Limits - EUR 28,000 a year (≈ $31,300) · 23% up to this amount - EUR 50,000 a year (≈ $55,900) · 33% between EUR28,000 (≈ $31,300) and this amount; 43% above #### Days in the country - At least 183 days in tax year (184 days in leap years) · A person who for most of the year (at least 183 days, 184 in leap years) satisfies at least one residence condition is resident in Italy for income tax. #### Tax residence Residents are taxed on income wherever produced; non-residents are taxed only on Italian-source income. #### Visas Independent of visa type. #### Other taxes Regional and municipal surtaxes, social contributions and VAT are separate. Checked against official sources on 10 Oct 2026 [Change log](https://settleanywhere.com/changes/) ## VAT, social security and other taxes - Italian VAT, social contributions and local taxes are separate. - Social contributions and VAT are separate. - Italian-source income and local taxes remain under ordinary rules. - Regional and municipal surtaxes, social contributions and VAT are separate. ## Questions people ask ### When do you become a tax resident in Italy? At least 183 days in tax year (184 days in leap years) (A person who for most of the year (at least 183 days, 184 in leap years) satisfies at least one residence condition is resident in Italy for income tax). Residents are taxed on income wherever produced; non-residents are taxed only on Italian-source income. ### Who qualifies for Substitute tax for new residents on foreign-source income? Not resident in Italy for at least nine of the ten tax periods before the option starts. No visa is needed for the election; it is a tax option. ### Who qualifies for Impatriate workers regime? Commit to Italian tax residence for at least four years and not have been resident in the three preceding tax periods. Independent of visa type. ### Who qualifies for 7% substitute tax in southern municipalities? Receive pension income paid from abroad and transfer tax residence to a municipality in Sicilia, Calabria, Sardegna, Campania, Basilicata, Abruzzo, Molise or Puglia with no more than 30,000 inhabitants, or to a municipality of 30,000 or fewer affected by the 2009 or 2016 earthquakes. Independent of visa type. ### How are Digital nomad visa holders taxed in Italy? No special regime in our records is tied to the Digital nomad visa. The standard rules apply: Residents are taxed on worldwide income, including foreign-source income: 23% up to EUR28,000, (≈ $31,300) 33% from EUR28,000 (≈ $31,300) to EUR50,000 (≈ $55,900) (reduced from 35% by the 2026 Budget Law), and 43% above EUR50,000 (≈ $55,900); non-residents are taxed on Italian-source income only. ≈ USD figures are approximate: daily reference rates from ExchangeRate-API, dated 12 Oct 2026, refreshed when the site is updated. **Sources (10)** ## Official sources 1. [Legge 30 dicembre 2025 n. 199 (Budget Law 2026): Art. 1 paras. 3 and 25-26](https://www.normattiva.it/uri-res/N2Ls?urn:nir:stato:legge:2025-12-30;199) · Normattiva · checked 2026-10-10 · published 2025-12-30 2. [Optional regime for new residents (Art. 24-bis TUIR): what it is](https://www.agenziaentrate.gov.it/portale/schede/agevolazioni/opzione-per-i-neo-residenti/infogen-opzionale-neo-residenti) · Agenzia delle Entrate · checked 2026-10-11 · published 2026-01-16 3. [Art. 24-bis TUIR (new residents substitute tax), consolidated text](https://www.agenziaentrate.gov.it/portale/documents/20143/241456/Articolo+24+bis+del+Testo+Unico_24bisTuir.pdf/7cc66a01-df4c-67b0-ddfd-f13bc80a5ae3) · Agenzia delle Entrate · checked 2026-10-11 4. [Impatriate workers regime (Art. 5 D.Lgs. 209/2023)](https://www.agenziaentrate.gov.it/portale/lavoratori-impatriati-209-2023/infogen-lavoratori-impatriati-209-2023-cittadini) · Agenzia delle Entrate · checked 2026-10-10 5. [Optional regime for foreign pensioners (Art. 24-ter TUIR), updated 8 May 2026](https://www.agenziaentrate.gov.it/portale/schede/agevolazioni/regime-opzionale-per-i-pensionati-esteri-che-cose-cittadini) · Agenzia delle Entrate · checked 2026-10-10 · published 2026-05-08 6. [DPR 917/1986 (TUIR), art. 24-ter, text in force 7 April 2026 to 31 December 2026](https://www.normattiva.it/uri-res/N2Ls?urn:nir:presidente.repubblica:decreto:1986-12-22;917~art24ter!vig=2026-10-12) · Normattiva · checked 2026-10-12 7. [Provvedimento n. 167878/2019: regime opzionale per i contribuenti con pensione estera (art. 24-ter TUIR)](https://www.agenziaentrate.gov.it/portale/documents/20143/1445390/Provvedimento+Regime+opzionale+contribuenti+con+pensione+estera.pdf/c49a9715-e4b8-fa5b-7a2e-ea0a1db8246f) · Agenzia delle Entrate · checked 2026-10-12 8. [IRPEF rates and calculation](https://www.agenziaentrate.gov.it/portale/imposta-sul-reddito-delle-persone-fisiche-irpef-/aliquote-e-calcolo-dell-irpef) · Agenzia delle Entrate · checked 2026-10-10 9. [General rules for individuals: tax residence for income tax (Irpef)](https://www.agenziaentrate.gov.it/portale/regole-generali-per-persone-fisiche1) · Agenzia delle Entrate · checked 2026-10-10 10. [Flat-rate regime (regime forfetario): what it is](https://www.agenziaentrate.gov.it/portale/regime-forfetario-le-regole-2020-/infogen-regime-forfetario-le-regole-2020-) · Agenzia delle Entrate · checked 2026-10-11 · published 2026-07-21