Guide · Founder immigration

Tax in Italy for Foreigners in 2026, and What a Founder Abroad Owes

By Federica Conti · Reviewed by Valentina Orsini · Updated 9 October 2026

The 2026 law, with each cited article valid to 31 December 2026.

Rooftops and domes of Rome at dusk

Italy taxes by residence and source, not by nationality. A tax resident pays personal income tax (IRPEF) on income from anywhere; a non-resident pays only on Italian-source income. The 2026 rates are 23, 33 and 43 percent, and people who move can use the flat tax, the impatriati relief or a 7 percent pension regime. A move can be part of the Italian golden visa route.

Who pays income tax in Italy, and does nationality matter?

No. Every individual, resident or not, is an IRPEF taxpayer under Art. 2(1) TUIR, the income-tax code (testo unico delle imposte sui redditi), and citizenship plays no part. A foreigner and an Italian with the same residence and the same income stand in the same position.

What decides the bill is residence and the source of the income. Under Art. 3(1) TUIR a resident is taxed on income wherever it arises, and a non-resident only on income produced in Italy. This is the 2026 law, and the rest of this page applies those two tests to a founder who stays abroad and to a founder who moves.

The two tests answer most questions in this guide. A tourist, an employee on assignment, a retiree and a company owner all start with the same pair: does the person count as resident for the year, and where does each euro of income arise? The next section sets out the first test, and the sections after it set out the rates and the special regimes that apply once the answer is known.

When does a foreigner become an Italian tax resident?

A person is resident for a tax year if, for most of the tax period and counting part days, they have civil-code residence, domicile or presence in Italy. One limb is enough. The test is in Art. 2(2) TUIR, as replaced by D.Lgs. 209/2023 from 1 January 2024. Residence is decided year by year (residenza fiscale, tax residence).

  1. Civil-code residence in Italy for most of the tax period?That limb is metCheck the next limb
  2. Domicile in Italy for most of the tax period?That limb is metCheck the next limb
  3. Physically present in Italy for most of the tax period, counting part days?That limb is metCheck the register entry
  4. Registered in the municipal population register for most of the period?Presumption of residence, rebuttable by proof to the contraryNo presumption from the register

One limb is enough (Art. 2(2) TUIR). The Agenzia delle Entrate reads most of the period as 183 days, 184 in a leap year.

Any one limb, held for most of the tax period, is enough; the register entry only raises a presumption.

Since 2024 domicile (domicilio) is the place where a person's personal and family relations mainly develop. Registration in the municipal population register (anagrafe) for most of the tax period creates a presumption of residence, which the person can rebut with proof to the contrary.

The Agenzia delle Entrate, the revenue agency, reads "most of the period" as 183 days, or 184 in a leap year. That is the agency's reading of the statute, given here as a paraphrase, not a separate statutory number. A visitor who stays below the test is a non-resident.

What are the income tax rates in Italy in 2026?

The 2026 national IRPEF scale has three brackets under Art. 11 TUIR: 23 percent, 33 percent and 43 percent. The 33 percent middle bracket is new for 2026, when it replaces 35 percent. Regional and municipal surcharges come on top and are not quantified here, so this page prints no all-in rate and no worked total. Whether a non-resident receives the deductions and credits that a resident does was not read, so the scale below is the starting point only, not a net result.

The 2026 national IRPEF brackets beside the 26 percent rates on dividends and on a sale of quotas, without regional or municipal surcharges.

Income or eventRateApplies toSource
Income up to EUR 28,00023 percentResidents on worldwide income, non-residents on Italian-source incomeArt. 11 TUIR, 2026
Income from EUR 28,000 to EUR 50,00033 percentThe sameArt. 11 TUIR, 2026
Income above EUR 50,00043 percentThe sameArt. 11 TUIR, 2026
Dividends of an Italian S.r.l.26 percent final withholdingResident and non-resident individualsArt. 27 D.P.R. 600/1973
Gain on a sale of quotas26 percent substitute taxQualified holdings includedArt. 3(1) D.L. 66/2014

Source: Art. 11 TUIR; Art. 27 D.P.R. 600/1973; Art. 3(1) D.L. 66/2014; each as the 2026 law, valid to 31 December 2026.

What does a founder who stays abroad owe Italy on an Italian S.r.l.?

A founder who owns or directs an Italian S.r.l. and never moves is a non-resident. Five points decide what Italy collects, in this order.

  1. Get the codice fiscale

    The Italian tax code is issued by the Italian consulate in the country where the founder lives, under the Agenzia delle Entrate's route for foreign citizens. No source read fixes a term for it.

  2. Directors' fees and pay

    Pay from the company is Italian-source under Art. 23 TUIR, on the standard reading even for work done abroad. The withholding rate on a director's fee is not covered here.

  3. Dividends

    The S.r.l. withholds 26 percent as a final tax under Art. 27 D.P.R. 600/1973. The founder may claim treaty relief or a refund of up to 11/26 with a foreign tax certificate; see the withholding tax guide.

  4. A sale of the quotas

    The gain bears 26 percent substitute tax, paid with the balance of the return unless a treaty or a domestic exemption applies. The Italian capital gains tax guide sets out the detail.

  5. The return

    Where Italian-source income is not fully settled by final withholding, a return is filed between 15 April and 31 October of the following year (Art. 2 D.P.R. 322/1998), through an authorised intermediary or with the person's own credentials.

What changes on the day a founder moves to Italy?

Six steps follow the move, from arrival to the treaty paper. The permit steps belong to the visa guides and are only named here.

  1. Arrive and register

    A non-EU citizen needs a visa and a residence permit (permesso di soggiorno), covered in the visa guides. Registering residence at the municipal anagrafe creates the presumption of residence if it lasts most of the tax period.

  2. Count the year

    If the test is met, the whole tax year is a resident year, not only the days after arrival.

  3. Check the foreign holding company

    A foreign company that the founder controls may be presumed Italian-resident from the same tax period; see the next section.

  4. File the first resident return

    It covers worldwide income, the foreign tax credit and, unless the flat tax applies, IVIE and IVAFE on assets abroad. It is filed from 15 April to 31 October of the following year, through an authorised intermediary.

  5. Pay by F24

    The balance and first advance fall by 30 June and the second advance by 30 November. The flat tax is paid in one payment by the balance date.

  6. Claim treaty relief

    Relief on foreign income needs a residence attestation from an Agenzia delle Entrate office. The source fixes no term for it.

A notebook, pens and a calculator on a desk
Residence is registered at the municipal office, and that entry starts the presumption.

Track A: founder stays abroad

  1. Codice fiscaleIssued by the Italian consulateNo term fixed by any source read
  2. Dividend paidS.r.l. withholds 26 percent as final taxArt. 27 D.P.R. 600/1973
  3. Fees and payItalian-source under Art. 23 TUIRNo term fixed by any source read
  4. Return, if neededThrough an authorised intermediary or own credentials15 April to 31 October (Art. 2 D.P.R. 322/1998)

Track B: founder moves to Italy

  1. Register at the anagrafeResidence presumed if it lasts most of the tax periodNo term fixed by any source read
  2. Interpello and optionFlat tax under Art. 24-bis TUIRBy the return deadline for the year of transfer
  3. First resident returnThrough an authorised intermediary15 April to 31 October
  4. Pay by F24Balance and first advance, then second advance30 June and 30 November
Track A never moves; track B registers residence. Only the statutory dates carry a date.

Can a foreign holding company become Italian-resident?

Yes. Under Art. 73(5-bis) TUIR, a foreign entity that controls an Italian company is presumed Italian-resident, unless it proves otherwise, if Italian residents control it or if its board is mostly made up of residents. The law calls the result esterovestizione; see when Italy treats a foreign company as Italian-resident.

The trap for a founder is timing, because both changes can arrive in the same year. The move that makes the founder a resident can, in the same tax period, make the foreign holding resident too. What the holding then owes in corporate tax is outside this page, and nothing here says where a board should sit.

Which regimes exist for people who move to Italy?

Three regimes sit beside the ordinary scale. Each has its own qualification, and the statute, not this page, decides who meets it. Our guide to the flat tax for new residents and the page on elective residence in Italy go further.

Flat tax for new residents

A person who moves residence to Italy and was not resident for 9 of the 10 preceding tax periods can pay a fixed sum on foreign-source income instead of the ordinary scale (Art. 24-bis TUIR).

Impatriati relief

For inbound workers with no Italian residence in the three preceding periods, only 50 percent of Italian work income up to EUR 600,000 a year is taxed (Art. 5 D.Lgs. 209/2023).

The 7 percent pension regime

Holders of foreign pensions who move to a small southern municipality pay a 7 percent substitute tax on all foreign income (Art. 24-ter TUIR).

The three regimes by qualification, amount, duration and statute, with no ranking.

RegimeWho qualifiesAmount or effectDurationStatute
Flat tax for new residentsMoved residence to Italy; not resident for 9 of the 10 preceding tax periodsEUR 300,000 a year on foreign income, EUR 50,000 per family memberUntil fifteen years from the first tax period of validityArt. 24-bis TUIR
ImpatriatiNo Italian residence in the three preceding periods; four-year residence commitment; high qualification50 percent of Italian work income taxed, up to EUR 600,000 a yearYear of transfer and four moreArt. 5 D.Lgs. 209/2023
7 percent regimeHolder of a foreign pension; municipality of no more than 30,000 inhabitants in the listed southern regions; not resident in the five preceding periods7 percent substitute tax on foreign incomeNine tax periodsArt. 24-ter TUIR

Source: Art. 24-bis and 24-ter TUIR; Art. 5 D.Lgs. 209/2023 as summarised by the Agenzia delle Entrate; the 2026 law.

How does the flat tax procedure work, and where do the sources disagree?

The option under Art. 24-bis TUIR must be exercised after a favourable ruling (interpello) from the Agenzia delle Entrate. It is exercised by the filing deadline of the return for the year of transfer and takes effect from that year. The amount is EUR 300,000 a year, with EUR 50,000 for each family member included, for people who move from the entry into force of L. 199/2025. EUR 200,000 applied to transfers up to 31 December 2025, as the Agenzia delle Entrate records.

The option lasts until fifteen years from the first tax period of validity. Gains on qualified holdings realised in the first five periods stay under ordinary rules. Option holders are relieved from foreign-asset reporting (RW) and exempt from IVIE and IVAFE.

The sources disagree on the ruling. An Agenzia delle Entrate page on the option for new residents, updated 16 January 2026, calls the ruling optional and allows the option in the next return. The statute says the option follows a favourable ruling, so the statute governs. How long the agency takes to answer a ruling request was not read, and this page gives no term.

Moving to Italy and need the steps in order?

We help you line up the codice fiscale, the registration, the ruling request and the filing dates before you move. The choice of regime stays with you and your advisers.

How is foreign income taxed twice, and what relief exists?

A resident's foreign income is taxed in Italy. Final tax paid abroad on that income is credited against Italian net tax under Art. 165 TUIR, capped at the share of Italian tax that the foreign income bears to total income, country by country. This is stated here in general terms. The credit matters most to a founder who moves while keeping a foreign salary, rental income or dividends from a holding company.

Treaty relief on foreign income needs an Italian residence attestation stamped by any provincial office of the Agenzia delle Entrate. Where the foreign state has no form, the agency's own model of 10 July 2013 is used. No treaty text was read for this page, so it states domestic law only and says nothing on US filing duties.

Does Italy have a wealth tax?

Not a general one. A resident pays two taxes on assets held abroad under Art. 19 D.L. 201/2011: IVIE at 1.06 percent of the value of real estate abroad, with no tax if the amount is EUR 200 or less, and IVAFE at 2 per thousand a year on the market value of foreign financial products.

IVAFE is 4 per thousand from 2024 in privileged-tax states. Wealth tax paid abroad is credited. Bank accounts pay a fixed sum whose amount this page does not give. A holder of the flat tax is exempt from both taxes, which matters for a founder who leaves property abroad.

What do heirs pay on an Italian company and other Italian assets?

If the deceased lived abroad, inheritance tax falls only on Italian assets (Art. 2(2) D.Lgs. 346/1990). Quotas and shares of a company with its legal seat, administration seat or main object in Italy are always deemed to exist in Italy (Art. 2(3)(b)). A founder who dies abroad leaves the S.r.l. quotas inside the charge. The rates below are the ones Art. 7 sets by relationship, and each heir is taxed on the share received, above the allowance where one applies.

Inheritance tax rates by relationship for successions opened from 1 January 2025, with the allowance each heir receives.

RelationshipRateAllowance
Spouse and lineal relatives4 percentOn the value above EUR 1,000,000 each
Brothers and sisters6 percentOn the value above EUR 100,000 each
Other relatives to the fourth degree and listed in-laws6 percentNone stated
Anyone else8 percentNone stated

Source: Art. 7 D.Lgs. 346/1990 as rewritten by D.Lgs. 139/2024, applied from 1 January 2025; the 2026 law.

When do you file and pay?

The calendar below is statutory, and the same dates bind a resident and a non-resident who files.

  • File electronically between 15 April and 31 October of the following year (Art. 2 D.P.R. 322/1998).
  • File on paper through Poste Italiane between 15 April and 30 June.
  • Pay the balance and the first advance by 30 June.
  • Pay the same balance 30 days later instead, with a 0.40 percent surcharge.
  • Pay the second or only advance by 30 November.
  • Pay everything by the F24 form, as the Agenzia delle Entrate sets out.
  • Send the return through an authorised intermediary or with your own credentials.
A desk with a laptop and tax papers
Filing and payment run on two calendars, and the payment dates come first.

What about IVA, the flat-rate regime and tourists?

IVA (imposta sul valore aggiunto), the Italian sales tax, is 22 percent as the standard rate, with reduced rates of 4, 5 and 10 percent under Art. 16 D.P.R. 633/1972. This is the 2026 law, and the rules for registering are in how an Italian VAT number is built and checked.

The flat-rate regime (regime forfetario) is a 15 percent substitute tax for sole traders with revenue up to EUR 85,000 under L. 190/2014. It is largely closed to non-residents.

A visitor below the residence test is a non-resident who owes IRPEF only on Italian-source income. IVA is already in shop prices. The tourist VAT refund is not covered on this page.

What changes on 1 January 2027?

D.Lgs. 117/2026, the consolidated income-tax code, has been in force since 4 July 2026. Every TUIR article cited here is valid to 31 December 2026, and the numbering changes on 1 January 2027. The VAT, withholding and inheritance texts cited also move.

Whether the brackets, the residence test and the regimes keep their content was not read for this page. This guide therefore states the 2026 law and will be reviewed before that date.

From our practice

The first question we ask a founder abroad is which of two tracks they are on: the founder who stays and the founder who moves. The same company produces different taxes for each. We set out the dates that bind, the move, the registration, the filing and the payment days, before anything is signed. We do not file returns or advise on a regime. Federica Conti leads this work.

Sources

The official texts this guide rests on, each with what it supports.

Statute texts are the 2026 law, valid to 31 December 2026.

Frequently asked questions

Do foreigners pay income tax in Italy?

Yes. Every individual is an IRPEF taxpayer and nationality is irrelevant under Art. 2 TUIR. A resident is taxed on worldwide income and a non-resident only on Italian-source income under Art. 3(1) TUIR. What decides the bill is where the person lives and where the income arises, as the 2026 law has it.

Do US citizens pay taxes in Italy?

Italy taxes by residence and source, not citizenship. A US citizen who is an Italian tax resident is taxed on worldwide income and can claim a foreign tax credit, and treaty relief needs an Agenzia delle Entrate residence attestation. US filing duties and treaty text are outside this page, which covers domestic law only.

When do I become an Italian tax resident?

For the year in which, for most of the tax period and counting part days, you have civil-code residence, domicile or presence in Italy. Registration in the anagrafe for most of the period creates a presumption that you can rebut. The Agenzia delle Entrate reads the threshold as 183 days, or 184 in a leap year.

What are Italy's income tax rates in 2026?

The 2026 IRPEF scale is 23 percent up to EUR 28,000, 33 percent from EUR 28,000 to EUR 50,000 and 43 percent above EUR 50,000 under Art. 11 TUIR. Regional and municipal surcharges come on top, and this page does not quantify them, so it gives no all-in rate.

I run an Italian S.r.l. from abroad. What do I pay in Italy?

As a non-resident, pay from the company is Italian-source, dividends bear 26 percent final withholding and a sale of the quotas bears 26 percent substitute tax, subject to any treaty. The withholding on a director's fee is not covered here. A return is needed where final withholding does not settle the income.

What changes on the day I move?

From that tax year Italy taxes your worldwide income, foreign property and financial assets attract IVIE and IVAFE unless the flat tax applies, and a foreign holding company may be presumed Italian-resident. The first resident return is due in the filing window of the following year, between 15 April and 31 October.

What is the Italian flat tax for new residents?

It is EUR 300,000 a year on foreign income and EUR 50,000 per family member, for up to fifteen years, available to a person who was not resident in Italy for 9 of the 10 preceding tax periods. Gains on qualified holdings realised in the first five periods stay under ordinary rules.

Do I need a ruling before choosing the flat tax?

The statute requires a favourable interpello before the option, and the option is exercised by the return deadline for the year of transfer. An Agenzia delle Entrate page still calls the ruling optional and allows the next return. The statute governs. How long the agency takes to answer was not read.

Is there a tax break for people who move to Italy to work?

Yes, the impatriati relief. Only 50 percent of Italian work income up to EUR 600,000 a year is taxed, for the year of transfer and four more. Conditions include no Italian residence in the three preceding tax periods, a four-year residence commitment and a high qualification, as the Agenzia delle Entrate summarises Art. 5 D.Lgs. 209/2023.

Is there a flat tax for retirees?

A 7 percent substitute tax applies to the foreign income of holders of foreign pensions who move to a municipality of no more than 30,000 inhabitants in the listed southern regions. It runs for nine tax periods, and the person must not have been resident in Italy in the five preceding periods (Art. 24-ter TUIR).

Does Italy have a wealth tax?

Not a general one. Residents pay IVIE at 1.06 percent on foreign real estate and IVAFE at 2 per thousand on foreign financial assets, or 4 per thousand in privileged-tax states from 2024. Holders of the flat tax are exempt from both. The rules are in Art. 19 D.L. 201/2011, the 2026 law.

When do I file and pay?

File online between 15 April and 31 October of the following year. The balance and first advance fall by 30 June, or 30 days later with a 0.40 percent surcharge, and the second or only advance by 30 November, all by the F24 form. Returns go through an authorised intermediary or with your own credentials.

Will my heirs pay Italian inheritance tax on my Italian company?

If you die resident abroad, Italy taxes only Italian assets, and quotas of a company with its seat or main object in Italy always count as Italian. Spouse and lineal relatives pay 4 percent above EUR 1,000,000 each; others pay more, up to 8 percent. The rates apply to successions opened from 1 January 2025.

What is the sales tax in Italy?

Italy's sales tax is IVA, the value added tax. The standard rate is 22 percent, with reduced rates of 4, 5 and 10 percent under Art. 16 D.P.R. 633/1972, the 2026 law. IVA is a separate tax from income tax, with its own registration and returns, and it applies to residents and non-residents alike.

Do tourists pay tax in Italy?

A visitor below the residence test is a non-resident who owes IRPEF only on Italian-source income, which for most tourists is none. IVA is included in prices at 22 percent as the standard rate. The tourist VAT refund for non-EU visitors is not covered on this page.