A fixed number instead of a percentage.

Art. 24-bis replaces Italian tax on all your foreign income with one annual figure, for up to fifteen years. Excellent above a certain level. A mistake below it.

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What the regime actually is

Italy allows an individual who moves their tax residence here, after a long period abroad, to elect a substitute tax on all foreign-source income. Not a rate — a fixed amount, irrespective of how much that income is.

  • 300,000 euro per year for those establishing civil residence in Italy from 1 January 2026.
  • 50,000 euro per year for each family member extended into the regime.
  • Renewable for a maximum of fifteen years.
  • Election requires that you were not tax resident in Italy for nine of the ten preceding tax periods.

The amount has moved twice. It was 100,000 euro from 2017, 200,000 euro from 2024, and 300,000 euro from 2026. Crucially, the increase is not retroactive: those who established civil residence before 1 January 2026 continue at 200,000 euro (25,000 per family member), and those who moved before 10 August 2024 remain at 100,000 euro. If you are already in the regime, you keep your number.

What it covers — and what it does not

The substitute tax absorbs Italian taxation on foreign-source income of every category: dividends, interest, royalties, capital gains, rents, business income arising abroad. It also removes the obligation to report those assets in the RW section and switches off IVIE and IVAFE on them. For someone with a complex international balance sheet, the administrative relief alone is significant.

What it does not do is equally important:

  • Italian-source income is taxed normally, at ordinary progressive rates. The regime is a settlement on the foreign side only.
  • Capital gains on qualified shareholdings realised in the first five years are carved out and taxed under ordinary rules.
  • It does not shield you from the tax rules of the other country. A US citizen, in particular, remains fully taxable at home — see our page for Americans moving to Italy.
  • Italian inheritance and gift tax continues to apply, although with a favourable territorial limitation for those in the regime.

One feature is often overlooked and frequently valuable: you may exclude specific countries from the election. Income from an excluded jurisdiction then falls under ordinary Italian rules — which can be the better outcome where a foreign tax credit is worth more than the shelter.

The arithmetic: when does it pay?

The regime is a fixed cost, so the logic is a break-even, not a preference. Ordinary Italian taxation of foreign investment income sits broadly around 26% for most financial income, with progressive rates up to 43% plus surcharges on other categories.

Against 300,000 euro fixed, the crossover therefore falls, very roughly, somewhere above one million euro of annual foreign income taxed at 26% — and lower where the income would attract progressive rates. Below that, you would pay less under the ordinary regime. Above it, the saving grows without limit, because the cost never moves.

It is a tool, not a trophy. The only figure that matters is the one calculated on your own income, in both countries.

The break-even also shifts with family members: adding a spouse and two children at 50,000 euro each raises the fixed cost to 450,000 euro, but usually shelters a far larger combined base.

Getting in, and getting out

  • Election is made in the tax return for the year in which residence is transferred, or the following one. A prior ruling from the Revenue Agency is optional but often advisable where the nine-year test is not clean.
  • Family members can be added later, and each can exit separately.
  • Revocation is permitted at any time, and the regime lapses automatically if the annual payment is missed — with effects that are not always intuitive.
  • Exit after fifteen years, or on revocation, returns you to ordinary worldwide taxation. What you do with your structures in year fourteen matters more than what you did in year one.

The most expensive mistakes I see are not in the election itself. They are in the year of the move: registration made in the wrong order, a disposal completed a month too early, or a foreign structure that behaves differently once Italian residence attaches.

Frequently asked questions

Is the 300,000 euro amount per person or per household?

Per person. The principal taxpayer pays 300,000 euro; each family member extended into the regime pays 50,000 euro. Family members are not covered automatically — each must be elected.

I moved to Italy in 2025. Do I now have to pay 300,000?

No. The increase applies to those who establish civil residence from 1 January 2026. If you established residence before that date, you continue at 200,000 euro, and at 100,000 euro if you moved before 10 August 2024.

Can I combine it with the impatriati regime?

The Revenue Agency has admitted the combination in defined circumstances, but the conditions are specific and the interaction must be verified on the facts. It is not a general entitlement.

Does the regime cover my Italian rental income?

No. Only foreign-source income falls within the substitute tax. Italian-source income of any kind is taxed under ordinary rules.

What if I already have a ruling from another country?

It does not bind Italy, but it matters. Prior rulings, exit taxes and trailing-residence rules in your departure country all feed the sequencing of the move.

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