+34 611 96 92 52

Italy
Retirees Tax Regime

Overview

Italy offers a special flat tax regime at 7% for foreign pensioners who relocate their tax residence to certain small towns in Southern Italy.

Designed to attract retirees with foreign-source income, this regime allows complete exemption from reporting foreign assets and significantly reduces global tax burdens for up to 10 years.

Benefits

Flat 7% tax rate on all foreign-sourced income, including pensions, dividends, interest, and capital gains.

No wealth tax on foreign financial assets (IVAFE) or real estate (IVIE).

No obligation to file the RW form (foreign asset reporting).

Applies for up to 10 consecutive years.

Foreign inheritance and gifts may be excluded from Italian taxation.

Applies regardless of remittance — foreign income is taxable at 7% whether brought to Italy or not.

No need to obtain an advance ruling (interpello).

Compatible with access to the Italian healthcare system.

Allows full EU residency and lifestyle benefits.

May apply to all types of foreign income, not just pensions.

Requirements and Procedures

Become a tax resident in Italy, residing more than 183 days per year.
Transfer residence to a qualifying municipality with less than 20,000 inhabitants in designated central regions, Southern Italy or certain islands (e.g., Sicily, Calabria, Sardinia, Campania, Puglia, Basilicata, Abruzzo, Molise).
Not have been Italian tax resident in the previous 5 years.
Have foreign-source income, including a qualifying pension.
Apply the 7% flat tax by electing it in the annual income tax return (Modello Redditi PF).
The option must be exercised in the first year of Italian tax residency.
No need to itemize foreign income — 7% applies on total foreign-source income.
Annual payment due with the personal income tax return.
Italian-source income is taxed under ordinary progressive rates.
Loss of residence in a qualifying town invalidates the regime.

How Charfort can help you?

Determine your eligibility for the 7% flat tax regime in Italy.

Assist in selecting a qualifying municipality based on your lifestyle and tax goals.

Support your residency registration and relocation process in Italy.

Handle tax registration and declaration filing, including application of the 7% regime.

Clarify the types of income covered under the regime and any exclusions.

Advise on coordination with home country tax obligations and treaties.

Help with Italian healthcare registration and local compliance.

Optimize estate and gift planning for foreign-sourced wealth.

Provide ongoing monitoring and tax filing support.

Liaise with foreign advisors to prevent double taxation risks.

Frequently asked questions

Everything you need to know about the process.

Who can benefit from the 7% tax regime in Italy?

Individuals with foreign pensions who move to qualifying towns in Southern Italy and were non-residents in the prior 5 years.

Is the regime only for pensions?

No. All foreign-source income qualifies for the 7% flat tax, including interest, dividends, and capital gains.

Do I need to remit the income to Italy?

No. The 7% applies regardless of whether income is remitted or not.

How long does the regime last?

It is available for up to 10 years from the first year of tax residence.

Do I have to report my foreign assets?

No. Under this regime, you are exempt from completing the RW form.

Is the 7% paid on gross or net income?

It is applied on gross foreign income, without deductions.

What happens if I move to a non-qualifying municipality?

The flat tax regime is terminated, and ordinary taxation resumes.

Can I apply for this regime without an advance ruling?

Yes. No interpello is required; you apply directly through the tax return.

Contact us today

Charfort assists international clients in obtaining residence and citizenship under the respective programs. Contact us to arrange an initial private consultation.

Talk with an expert