“Impatriates” – 70%/90% Tax break to attract “human capital” to Italy

The Italian Government has recently modified the special tax regime designed to encourage the movement of “human capital” to Italy (lavoratori impatriati”).

  • The current regime provides that 70% of qualifying income from employment carried out in Italy is exempt from income tax.  So only 30% of gross salary/net profit  is liable to income tax.  100% of salary continues to be liable to social security under normal rules
  • The exempt portion is 90% (so 10% taxable)  if you take up residence in one of the regions of Abruzzo, Molise, Campania, Puglia, Basilicata, Calabria, Sardinia, Sicily
  • The regime applies for five consecutive accounting periods, until revoked, or until the conditions for the relief cease to apply can be extended for a further five years if certain conditions are met
  • The requirement to have a University decree/highly specialized job has been abolished for Italian citizens returning to Italy
  • The requirement to perform services for an Italian company (or foreign company belonging to an Italian group) has been abolished. The geographical requirement is now that the work is performed mainly in Italy
  • To qualify you must have been tax resident outside Italy in the two tax periods preceding the year in which you transfer to Italy
  • You must commit to reside in Italy for at least two years
  • You need to be tax resident in Italy in the first year in which you move, or the year immediately following the year of the move, if you move in the latter half of any year
  • Moving your residence to Italy must be made in connection with the new job.

The exemption applies only to income taxes. It does not apply to statutory social security contributions (pension and healthcare) which will be calculated on 100% of salary.

The income tax exemption applies for a further five tax periods following the end of the first five year period to an individual worker:

  • with at least one minor (under 18) or dependent  (over 18 but earning less that the relevant annual financial thresholds child; and
  • who becomes the owner of at least one residential property in Italy after moving (or  12 months prior to becoming tax resident).
  • during the extension period, the tax exemption drops to 50%, but can increase to 90% for impatriates purchasing/owning real estate in Italy and with at least three dependent children.

If you are an employee you need to make a written letter of request to your employer.  For the self-employed (and those employees who have not presented the letter of request in time) the benefit can be claimed in the relevant annual tax return which will generate the refund either via your payslip, a payment from the authorities or credit to offset future tax liabilities. We can assist with the refund claim.

If you would like advice on whether you qualify for the relief and/or a pre-compiled copy of the letter you need to send your employer please get in touch.

Legislation and guidance (mainly in Italian)

Article 5 Decree law no. 34 /2019

Tax Agency Guidelines and Further Reading

Tax Agency Circular no 17 /E of 23 May 2017 – Regimi agevolativi per persone fisiche che trasferiscono la residenza fiscale in Italia

Tax Agency Circular no 33/E of 28 December 2020

Tax Agency Guidebook (in English) – incentives for attracting human capital to Italy

Italian Tax Agency Website


Risoluzione no. 72 del 26 settembre 2018 – pdf  – Impatrio dei soggetti di cui all’articolo 16 del decreto legislativo 14 settembre 2015, n. 147 – Attività lavorativa prestata in Italia e all’estero per società appartenenti ad un gruppo multinazionale

Risoluzione no. 51 del 6 luglio 2018 – pdf  – Residenza fiscale all’estero prima dell’impatrio per i soggetti di cui all’articolo 16, comma 2, del decreto legislativo 14 settembre 2015, n. 147

Risposta no. 492 2019 – assignment to France  – importance of lack of continuity

Risposta Interpello no. 495 2019 – taxpayer coming from Ireland – taxed in full on first year (as non resident), commencement of special regime starting from first year of tax residence and following four years

Risposta no. 497 2019 – taxpayer working abroad, not registered with the AIRE

Risposta no 59/2020 – Timing of the benefit – interaction between time of starting work and first year of tax residence  – importance of claiming relief either by reques to the employer or in tax return for first period of residence

Risposta no 533 2020 – Two years residence abroad for study purposes (Master’s Degree) not sufficient

Risposta no. 42/2021 – Employee assigned abroad, returning to Italy – importance of non continuity

Risposta no. 596/2021  – Impatriate’s regime available for employees working remotely for non Italian companies


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