The Italian flat tax for new residents, and the day count under it

Italy’s regime for new residents substitutes a single annual charge for income tax on everything you earn outside Italy. It is the most straightforward proposition in European relocation: a fixed number, paid once a year, in place of an entire category of taxation.

Two things about it are frequently reported wrongly. The figure has now risen twice since the regime was introduced, and the older number appears in a great deal of material still in circulation. And the entry condition is not the payment — it is becoming Italian tax resident, which is a day-count question decided under a test that was itself rewritten recently.

The charge, and its history

The regime sits in Article 24-bis of the consolidated income tax code, introduced by the 2017 Budget Law. An individual who transfers tax residence to Italy may elect to pay a fixed substitute tax on all foreign-source income, in place of ordinary Italian taxation of it.

The charge was EUR 100,000 a year at introduction. Decree-Law 113/2024 raised it to EUR 200,000 for individuals who transferred residence to Italy after 10 August 2024. The 2026 Budget Law, published on 30 December 2025, raised it again to EUR 300,000 for individuals who become Italian tax resident on or after 1 January 2026. The additional charge for each family member brought into the regime rose from EUR 25,000 to EUR 50,000 over the same reform.

Each increase applied prospectively. Taxpayers already within the regime continue to pay the amount in force when they relocated, for the remainder of their entitlement, with no retroactive effect. That grandfathering is worth stating plainly, because the practical question for anyone who moved before the changes is simply which cohort they fall into — and the answer turns on the date tax residence was acquired, not on the date of the election or the filing.

Verify the current figure against the Agenzia delle Entrate before planning around it. It has moved twice in under two years, and there is no reason to assume it has finished moving.

The conditions

Nine of the ten preceding tax periods. You must not have been Italian tax resident for at least nine of the ten tax periods preceding the one in which the option takes effect. This is the substantive gate. It is generous towards returning Italians who left long ago and closed to anyone who has been in and out of Italian residence recently.

Fifteen years, and no more. The option runs for a maximum of fifteen tax periods from the first year it applies. It cannot be renewed. It terminates earlier on revocation, on failure to pay the substitute tax by the deadline for the balance of income tax, or on the conditions ceasing to be met — and termination is total, returning you to ordinary worldwide taxation.

Family members. The regime may be extended to family members within the categories in Article 433 of the Civil Code, for an additional annual charge each. Each of them must independently meet the nine-of-ten-years condition, which is the point most often missed when a household moves together with different histories.

Italian-source income is unaffected. The substitute tax covers foreign income only. Italian salary, Italian property income and Italian business profits are taxed under ordinary rules at ordinary rates.

Two carve-outs. Capital gains on qualifying shareholdings disposed of within the first five years of the regime fall outside the substitute tax and are taxed ordinarily — an anti-avoidance rule aimed at people relocating to realise a single large gain. And the taxpayer may elect to exclude income from particular countries, which is sometimes done to preserve treaty relief.

An advance ruling may be sought from the Agenzia delle Entrate confirming eligibility. It is optional, and given the size of the annual commitment it is usually taken.

The part that is a day count

None of the above engages until you are Italian tax resident, and that is the condition people handle least carefully.

Italian tax residence for individuals was redefined with effect from 2024. An individual is resident if, for the greater part of the tax period, they are registered in the resident population register, or have their residence or domicile in Italy under the amended definitions, or are simply physically present in Italy. Domicile was recast around where personal and family relations principally develop, rather than around economic interests, and registration in the anagrafe became a rebuttable presumption rather than a conclusive one.

The greater part of the tax period means at least 183 days in an ordinary year, counted on a calendar-year basis, with fractions of a day counting as whole days. That last convention is explicit since the 2024 reform and is stricter than many arrivals assume. The Italian presence test sets out the counting rules in full.

Three consequences follow for anyone electing into Article 24-bis:

• Residence attaches to the whole calendar year. Italy does not operate a split-year mechanism in its domestic law. Arrive in time to cross the threshold and you are resident for the entire year, including the months before you moved.
• Arrival timing is therefore decisive. Crossing the line by a small margin brings the whole year into charge, and with it the whole annual substitute tax. Falling short by a small margin means the regime does not begin until the following year.
• The count must be evidenced, not asserted. The registration in the anagrafe is now rebuttable, which cuts both ways: it can be displaced by facts, and it does not by itself establish the residence the regime requires.

The country you are leaving

Italian residence does not by itself end residence elsewhere, and in the year of arrival dual residence is the normal position rather than the exception.

If you are leaving the United Kingdom, the Statutory Residence Test applies its own counting conventions — UK midnights, tie-based thresholds — and split-year treatment may or may not be available. The interaction with the UK’s foreign income and gains regime for new arrivals is worth modelling in both directions before choosing a destination. If you are a United States citizen, the flat tax does nothing for your US filing obligation, and the substitute tax raises a real question about foreign tax credit availability that should be taken to a US adviser first.

Where a treaty applies, dual residence is resolved by tie-breaker. Italy’s treaty network is extensive, which helps — but a tie-breaker turns on permanent home and centre of vital interests before it reaches habitual abode, so the days are the opening evidence rather than the conclusion.

Planning notes

• Confirm the current substitute tax figure and the family member charge before committing. Both have changed twice recently.
• Fix the date on which Italian tax residence will be acquired, and count towards it deliberately. The whole regime, and the whole year’s charge, turns on it.
• Check each family member’s own nine-of-ten-years history separately. A single ineligible member does not disqualify the household, but nor can they be carried.
• If a large disposal of a qualifying shareholding is in prospect, take advice on the five-year carve-out before relocating rather than after.

What Residay tracks

Residay counts Italian days against the reference line above, using the part-day convention Italy applies rather than the midnight convention used in the United Kingdom, and holds the evidence behind each attributed day on your device.

That matters here for two reasons. In the year of arrival the count decides whether the regime begins at all, and it decides it for the whole calendar year. In later years the same record is what answers a challenge from the country you left, which will be examining the same period on incompatible rules. What the app cannot do is decide domicile or centre of vital interests — those are legal tests about your relationships, not arithmetic. It can make sure the arithmetic underneath them is contemporaneous and documented.