The Italian Revenue Agency is now accepting requests. High net worth individuals who live overseas and want to take advantage of a new “flat tax” are kindly invited to apply (but so far the forms are in Italian, see www.agenziaentrate.gov.it ).
The measure to reshore capital generated abroad is ready. Individuals can pay a flat tax of €100,000 on income produced abroad with the possibility of extending the tax regime to family members (with a flat rate of €25,000).
The provision includes a checklist to add to the request for a ruling that allows a preliminary valuation by the revenue service on the admissibility to the tax regime: individuals pay a flat tax of €100,000 on income produced abroad with the possibility of extending the tax regime to family members (with a flat rate of €25,000).
The payment must be done in one solution for every fiscal year covered by the tax, within the deadline for the payment of the income tax balance.
The regime is reserved to individuals, but not companies, who move their fiscal residence in Italy. Taxpayers cannot have been resident in Italy for at least nine of 10 fiscal years prior to the year of validity of the provision. The flat tax covers income produced abroad but does not apply to capital gains earned through the sale of financial holdings during the first five tax years of validity of the measure.
How to apply
Eligible taxpayers can ask to participate in the new regime when they present their tax returns for the fiscal year during which they moved the tax residence in Italy or during the immediately following year. They can also present a specific preliminary request for a ruling to the central direction of the Italian Revenue Agency.
The request can be filed in person, sent by certified mail with receipt or emailed through a certified email address.
In the request the taxpayer needs to indicate:
• personal data, the Italian social security number, and the residence address in Italy, if already resident;
• the non-residents status in Italy for a period of at least nine tax fiscal years during the 10 years prior to the validity of the option;
• the last jurisdiction where the taxpayer was resident before the fiscal period when the option came into force;
• the foreign states or territories where the taxpayer does not intend to use the substitutive tax.
The taxpayer must indicate the presence of the necessary requirements to access the regime, compiling a checklist.
The option must be exercised within the deadline for tax returns, also when the Tax Revenue Agency has not yet replied to the request for a ruling.
The request can be filed even when the deadline to move the fiscal residence in Italy has not passed.
The option is automatically renewed every year, while all its effects end 15 years after the first period of validity.