Clarifications by Agenzia Entrate (no. 33/E of 28/12/2020) relating to the tax regime for those who decide to repatriate to Italy (art. 16 DL 147/2015).

The major benefit consists of a reduced taxation of income (employment, assimilated worker or self-employment) for those who transfer their tax residency to Italy and undertake to maintain it for at least two fiscal-year. The income exemption rate is 70% and increases for those who transfer their residency to one of the regions in central and southern Italy, as specifically identified by law.

To benefit from the special fiscal regime, it is mandatory to verify the following subjective and objective requirements: 1) the subject must not have been a resident in Italy during the two fiscal year prior to the transfer of residence; 2) the subject must transfer his residency to Italy and undertakes to reside for at least two fiscal year; 3) the subject carries out his activity mainly in Italy.

This benefit lasts for a period of five years, from the tax period in which the subject transfers his tax residency to Italy and for the following four years.

Furthermore, the possibility of taking advantage of an extra five-year concession was introduced (with an income exemption rate of 50%) in the presence of the following alternative conditions: purchase of residential real estate unit in Italy and presence of at least one minor or dependent child on your income tax report, even in foster care.

Citizens of an EU or non-EU country with a Double Taxation Convention or an agreement on the exchange of tax information may also have access to the reduced tax regime