What is the impatriate tax regime?
The impatriate tax regime (regime impatriati) is an Italian income tax relief for qualified workers who move their tax residence to Italy. Under article 5 of Legislative Decree 209 of 2023, which applies to moves from 2024, only 50% of employment and professional income produced in Italy is taxed, up to €600,000 of income a year.
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To qualify, the worker must:
- commit to staying tax resident in Italy for four years;
- not have been tax resident in Italy in the previous three tax periods;
- work in Italy for most of the tax period;
- hold high qualifications or specialist skills, or have carried out research in artificial intelligence technologies.
The time abroad rises to six tax periods if the worker goes on working for the same employer or group that employed them abroad, and to seven if they had also worked for it in Italy before leaving.
How long it lasts and the child uplift
The relief applies in the year of the move and the following four tax periods. The taxable share falls to 40% if the worker moves with a minor child, or has or adopts a child during the period, from the year of the birth or adoption. The child must be resident in Italy while the higher relief applies. If the worker keeps Italian tax residence for less than four years, the relief is lost and the tax saved is recovered with interest.
A worked example
An employee with gross income of €100,000 is taxed on €50,000 under the regime, or on €40,000 with a minor child. Social security contributions are not reduced by the regime, so the employer’s and the employee’s INPS costs still apply to the full pay.
How payroll applies it
Where there is an Italian withholding agent, the worker can ask the employer in writing, with supporting documents, to apply the relief through payroll, and any difference is settled at the year-end adjustment. Otherwise, the worker claims it in their tax return. Workers who moved before 2024 stay under the earlier rules.
The regime when TopSource runs your payroll
When TopSource runs your payroll in Italy, we collect the employee’s request, apply the taxable share in the monthly withholding and at the conguaglio, and report the relief in the CU.
Frequently asked questions
How much tax relief does the impatriate regime give?
Only 50% of income up to €600,000 a year is taxed, or 40% with a minor child, for five tax periods.
What happens if the worker leaves Italy early?
If they do not keep Italian tax residence for at least four years, they lose the relief and the tax saved is recovered with interest.
Does the regime reduce social security contributions?
No. It applies to income tax only, so INPS contributions are still due on the full pay.
Related terms in Italy
- Comunicazione Obbligatoria (Italy)
- Libro Unico del Lavoro (Italy)
- Smart Working Agreement (Italy)
- ROL and Ex-Festività Permits (Italy)
- Patto di Non Concorrenza (Italy)
- Employee Categories (Italy)
- Mandatory Disability Hiring Quota (Italy)
- Cassa Integrazione (Italy)
- Decreto Flussi and Nulla Osta (Italy)
- Welfare Aziendale (Italy)
- F24 Payment Form (Italy)
- UniEmens (Italy)
- Certificazione Unica (Italy)
- Modello 770 (Italy)
- Busta Paga (Italy)
- Conguaglio Fiscale (Italy)
- Supplementary Pension Funds (Italy)
- IRAP (Italy)
- Cuneo Fiscale (Italy)