Departure From Italian Shores
If you have decided to say arrivederci or adieu to the Bella Vita after a period of residence in Italy, there are a few considerations in terms of tax that you should bear in mind.
Fiscal Code Number
You do not need to cancel your fiscal code number and indeed there is no method so to do, for an individual, except in cases of error. It is simply a code number and remains with you for life.
If you return to Italy at any time, or have any relevant dealings in Italy in future, then your code will simply be there.
So do not lose it, you never know. And do not ask for another one simply because you cannot find the original. If, for whatever reason, you change name (e.g. marriage) before you need the fiscal code number in future, you should advise the Tax Agency so that they can issue a new fiscal code and cancel the old one. It might be possible to advise the Tax Agency of a change of residential address using the same form used to apply for the fiscal code number but the preferred specific procedure is outlined below.
Registration as Resident with the Anagrafe (the Register of Italian Resident Population)
What is very important is that you cancel your registration as a resident with the Anagrafe maintained by your Comune via the specific form made available by the Comune for this purpose. You should also hand in, or destroy (if authorised), your ID card which loses its validity as soon as your cease to be registered as resident. Using an Italian ID Card for any reason, once you are no longer registered as resident ,could constitute a serious offence. Some Comuni allow you to notify the change this by registered electronic mail (PEC) or online via the relevant portal.
If you do not remove yourself from the register of resident population, you might be presumed to remain tax resident in Italy, under the Italian test of tax residence for the rest of time!
If you are an Italian citizen, you should take steps to apply for registration with the AIRE (register of Italian citizens resident abroad) as soon as possible. This requires application to the local consulate for the jurisdiction to which you have transferred residence. Unlike non-Italian citizens you do not need to apply to your Italian Comune of Residence. Once you notified the Consulate, it will be the Consulate who notify your former Comune that you have transferred abroad. The timescale for this can be lengthy, but for tax purposes at least, you will be considered as having transferred residence from the date of application to your Consulate.
The importance of prompt registration with the AIRE should not be underestimated, as there is a whole series of rights and potential obligations that stem from that and the relevant timing.
Notification of Change of Domicile
You should also consider, especially if you are not an Italian citizen, advising the Italian Tax Agency of an address for service of official notices (e.g. assessments or tax enquiries). And if you think that making yourself hard to find is a good idea to escape tax assessments, think again. There is a procedure whereby the authorities can file a notice e.g. of assessment or payment demand, with the Comune where you were formerly resident. After a period of time, the notice will be automatically deemed to have been validly served. Once the timescale for response, appeal, or initiation of a negotiated settlement process has lapsed, the authorities will be entitled simply to commence enforcement proceedings. Having lost the right to challenge the assessment, the amounts due are final – you will have missed the boat for presenting any challenge.
The procedure and form for reporting the transfer of residence to the Tax Agency can be found here.
Social Security
If you have been making contributions to INPS or other Italian social security authority while working in Italy you should consider logging on to MyINPS and downloading a hard copy of your contributions history., before cancelling your registration as resident. The logon to MyINPS requires a SPID (digital identity) and if you are not an Italian citizen the SPID may well expire once you no longer resident. At that stage the only way to consult your position, pending any extension of digital identities to non residents, will be via an authorized tax assistance centre (CAF, ACLI or Patronato) who will also be able to assist with issues such as additional voluntary contributions and totalization of foreign contribution periods.
When you reach pensionable age and acquire the right to receive the pension, your social security should get in touch to advise you of the fact. But that requires keeping details of your current address updated and anyway is not a perfect system, so it is a good idea to identify as you leave what the expected date (under current law, no guarantee that it will remain constant) of entitlement to a pension is, so that you can contact your Italian pension provider nearer the time..
Tax Residence Issues
Cancelling your residence with the Comune and transferring your habitual abroad should mean that you lose your Italian tax residence status.
The timing of the cancellation and effective date of transfer is important, due to the 183/184 days test in the Italian statutory test of tax residence. Since this is an all – in all out concept of tax residence for any Italian tax year, if you transfer residence after the 183 day cut off, you will be treated as tax resident for the whole tax year in which you transfer. this means you can be liable to Italian tax on income received, and assets owned, for the remainder of the year, even after you have moved.
Cancelling your registration after the 183/184 days has passed means that you are, under the test, Italian tax resident for the whole of the current tax year, with a consequent obligation, subject to the intervention of an applicable double tax treaty, to report worldwide income received up to 31 December of the exit year and assets owned in that year.
Note that the test of tax residence includes not just your position as registered resident with the Comune, but also factors such as physical presence in the year, where your close family are resident and where your “habitual abode” is located. You should consider carefully if you are inf act going to lose your status as tax resident in Italy, if
- you are going to be spending more time than 183 days in any tax year in Italy;
- your close family will remain in Italy;
- you will have a residential accommodation in Italy afte the move.
Cancelling your registration as resident with the comune will likely trigger a liability to IMU (local property tax) starting from the date of de-registration, if you continue to own Italian real estate after the move. What was a prima case become a seconda casa from that date, with all the ensuing consequences.
And remember if you have Italian nationality and transfer your residence to a jurisdiction on the Black List of non- cooperative jurisdictions (i.e.. a tax haven) you will regardless continue to be presumed an Italian tax resident for the rest of your years (subject to proof to the contrary).
Let us know if you need any assistance.