If you’re planning to move to Italy and take advantage of the 7% flat tax benefit, I have some great news my friends that I am sure you are going to love.
Let’s first have a quick reminder of what the 7% flat tax scheme is.
In 2019, Italy implemented a 7% flat tax regime for new arrivals who receive government pensions or private pensions from a foreign country. This law allows pensioners who relocate to certain regions in Southern Italy with fewer than 20,000 inhabitants or select towns in Central Italy with fewer than 3,000 inhabitants, to pay a flat tax of 7% on their foreign earned income while reaping the benefits of la dolce vita in Italy.
The 7% regime is valid for a duration of ten years after which the regular taxation rules in Italy apply. For many foreigners, the savings are substantial.
However, many people who need the savings have been disappointed to learn that their chosen dream location further up the boot, was not part of the 7% scheme.
Well, I’ve got some good news for you.
Recent updates to the law have changed the qualifying criteria for some Central Region municipalities to benefit from the flat tax. In the past, only a selection of small comune that had under 3000 population were included in the law.
These towns were designated to be affected by the earthquakes and were in a higher-risk seismic zone. They were also quite remote, had very few services, and were not attracting new residents to the region as hoped. In fact, only 50 people have elected to the tax regime in these areas since it was implemented. This is less than a success.
Therefore, the government has made some changes and has just announced that they have increased the population threshold to 20,000 residents (from 3000) which opens several amazing places in Marche, Lazio, and Umbria. They are still in seismic zones, but very habitable and some extremely popular for tourists.
I won’t keep you waiting any longer.
Here is a list of the towns that qualify for the 7% flat tax benefit.
Happy house hunting!
If you are looking for a new place to call home in Italy, be sure to visit us at www.smartmoveitalyproperty.com Our buyers and renters agency, that specializes in helping foreigners find their new home in Italy.,
Are you retiring with an Elective Residency Visa but are not 100% sure you have completed your application right? Jump on the next Elective Residency Visa Workshop, and increase your chances of success!
Hi there, does this extension of the tax zone also apply to foreigners coming to work in the area? To be taxed on 10% rather than 30% of income, you needed to live somewhere from Abruzzo and further south, is that still the case? Do you have a link to a government site announcing the change? Thanks in advance!
One of the major requirements for the 7% flat tax is that you are receiving a pension. You can still be working somewhere and receiving a pension and qualify. However, this is a flat tax for foreign-sourced income. the 90/10 & 70/30 is still designated by Region and the south is the 10%. This has not changed.
Hello!
Can you please link to an official government announcement for the new 7% tax locations in Umbria, Lazio and Marche? A quick search found nothing about this.
Thanks!
Please look closely at the list and names. Rieti is Rieti;Rivodutri (RI) and Ascoli Piceno is Ascoli Piceno; Belfort del Chienti
Spoleto on its own looks like a double of Monteleone do Spoleto or Cerrato di Spoleto.
I will double check that so that you for pointing it out.
Can I come earned through an overseas business be used for this? I have an online biz that I can run from anywhere and pull money out from.
I’m looking at moving to Italy, I’m retired with a pension and rental income; For it to make sense, I need to live in a village that has the 7% tax regime. BUT I also have a young son, he’s 4 now, likely be almost 6 by the time we organize a move. I’m fine with him learning Italian in school, as long as his education is good, and supportive/progressive. (I had been looking to move to Greece as well, but I’m unimpressed with their education, and don’t see Greek as a terribly beneficial language for him to learn.) With Italian, he can pick up Spanish or Portuguese very easily later. I speak Spanish and some Portuguese, so despite being in my 60s, I don’t think conversational Italian will be too hard for me to learn. My son at this moment speaks Chinese and English though. It’s hard to find a place that is 1. small enough to qualify for the tax regime, 2. has good education? 3. is near enough to some cities that are at least enough bigger to have some things to do?
Hello,
Great article! I am curious, my husband and I are in our 40’s and plan to live in Italy (we will have the appropriate residency handled) . We receive interest income on assets from the US. Obviously, we are not yet pensioners, receiving pension based income, but are we able to still take advantage of the 7% tax break? Thus pay the 7% on the interest income we receive? Thank you!
This is great news! Thanks for the list of the new Flat Tax towns.
Do you have a sub-list of which of those towns have a train station?
Thanks!