Italy has become one of Europe’s most attractive destinations for internationally mobile, high-net-worth individuals — largely thanks to the flat-tax regime for new residents, introduced in 2017 under Article 24-bis of the Italian Income Tax Code (TUIR). This guide explains how the regime works in 2026, who qualifies, and — just as importantly — how to think about your wealth once you become an Italian resident.
What the regime actually is
In simple terms, the regime lets a qualifying new resident replace ordinary Italian taxation on all of their foreign-source income with a single fixed annual amount — regardless of how much they actually earn abroad. Someone with millions in foreign dividends, capital gains, interest or rental income pays the same flat figure as someone with far less.
Who qualifies
The core requirement is straightforward: you must transfer your tax residence to Italy, and you must not have been an Italian tax resident for at least 9 of the previous 10 tax years. This makes the regime available to returning Italians and foreign nationals alike, as long as they have spent the last decade largely outside Italy. Italian tax residence is generally established by being registered as resident, or having your habitual abode or the centre of your interests in Italy, or being present for more than 183 days in a year.
Family members
The regime can be extended to family members for a fixed €50,000 per year each, on the same foreign income. For a couple or family with substantial international assets, this can make the overall effective rate very low.
Duration
The regime lasts for a maximum of 15 years, renewing automatically each year. It can be revoked at any time, and it lapses if the annual substitute tax is not paid.
What it covers — and what it doesn’t
The flat tax covers foreign-source income only. Italian-source income — for example, a salary from an Italian employer or rent from an Italian property — remains taxed under ordinary Italian rules. Alongside the flat tax, beneficiaries also enjoy meaningful simplifications:
- No IVIE/IVAFE wealth taxes on assets held abroad.
- No RW foreign-asset reporting obligation for those assets.
- No Italian inheritance or gift tax on assets and rights held abroad during the regime.
One common nuance: capital gains on certain qualified shareholdings realised in the first years of the regime may fall outside the flat tax and be taxed ordinarily — a detail worth checking with your tax advisor before you move assets or realise gains.
How many people have used it?
The regime has grown from just 94 beneficiaries in 2017 (its first year) to around 1,600 new entrants in 2024, with an estimated 5,000+ beneficiaries cumulatively by the end of 2025. It remains a small but rapidly expanding community of internationally mobile, high-net-worth individuals — and a clear signal of Italy’s growing appeal for global wealth.
Why the tax election is only half the story
Securing the flat tax is a job for a commercialista (Italian tax advisor). But the regime says nothing about how your capital should actually be invested and structured once you live in Italy — and that is where most newcomers are underserved. Portfolios built for another country’s tax system, currency and product landscape are rarely optimal for an Italian resident.
This is the work of an independent, fee-only financial advisor: an objective review of your existing holdings and their true cost, restructuring around low-cost and tax-efficient instruments, managing cross-border and currency exposure, and coordinating with our trusted tax and relocation partners so the whole picture fits together. Crucially, an independent advisor is paid only by you — not by the banks or funds whose products end up in your portfolio.
This article is general information, not tax, legal or personalised investment advice. AC Advisor is an independent financial advisor registered with the Italian OCF (Reg. no. 1145) and does not provide tax or legal services. Tax rules reflect provisions in force in 2026 and may change; the flat-tax election and filings must be handled with a qualified Italian tax advisor. Last updated: 2026.