10 YEARS TAX BREAK! 70>90%
Good news for non-EU entrepreneurs and investors willing to move their fiscal residence to Italy: that’s in the Growth Act (Art. 5, D.L. n. 34/2019 – Misure urgenti di crescita economica e per la risoluzione di specifiche situazioni di crisi) issued by the Italian Government on 30 April 2019, and entered into force on May 1st.
Those people’s incomes made in Italy as entrepreneurs, employee or working investors will contribute to the personal revenue only for the 30% of the amount. For example, assuming an annual income for €100K earned in Italy, the new resident will pay tax such as his incomes would be like € 30K!!!
This taxation preferential treatment will be even more favourable (it will drop from 30 to 10%) if the new residency will be taken in one of the following areas: Abruzzo, Molise, Campania, Puglia, Basilicata, Calabria, Sardinia, Sicilia.
This tax break will be in place for 5 years of residency but it will be extended for 5 years more if the new resident has an underage child (including over age children if unemployed) or in case the new resident has bought his own flat or house during his staying or even a year before his transfer. In the last case the percentage increase to 50% but it might even decrease to 10% if the new resident has at least 3 kids.
Originally introduced by the Item 5 of the Act for the “Returning Brains from Abroad” only, it has been extended to non-EU citizens highly skilled, including entrepreneurs and working investors, who have decided to move to Italy.
Following conditions are required for the applicant to access the favourable taxation plan, therefore the applicant:
1) will have to demonstrate the residency out of the Italian borders in the last two taxation periods before moving and has to plan to live in Italy at least for two years;
2) will practice his main job from Italy;
3) needs to be coming from a Country which has a “no double taxation deal” with Italy or an “exchange of tax information deal” with Italy (those country are: Albania, Algeria, Saudi Arabia, Argentina, Armenia, Australia, Azerbaijan, Bangladesh, Barbados, Belarus, Brazil, Canada, Chile, China, Congo, South Korea, Ivory Coast, Ecuador, Egypt, United Arab Emirates, Ethiopia, Russian Federation, Philippines, Georgia, Ghana, Japan, Jordan, Hong Kong, India, Indonesia, Israel, former Yugoslavia, Kazakhstan, Kuwait, Lebanon, Macedonia, Malaysia, Morocco, Mauritius, Mexico, Moldova, Mozambique, New Zealand, Oman, Pakistan, Panama, Qatar, Senegal, Singapore, Syria, Sri Lanka, United States of America, South Africa, Tanzania, Thailand, Trinidad and Tobago, Tunisia, Turkey, Ukraine, Uganda, former Soviet Union, Uzbekistan, Venezuela, Vietnam Zambia)
4) has to hold at least a Bachelor Degree and needs to be an employee, a self-employed or an entrepreneur abroad in the last 24 months.
Please note: all those conditions need to be observed to access the above tax break. The non-EU entrepreneur and investor, to move the fiscal residency to Italy, needs an entry visa as employed or self-employed and practice from Italy, because the tax break is available in this case only. People with elective residency or business permit only, for example, are not eligible for it.
Altogether considering the different kinds of working visas available in Italy, the visa for Investors – available since January 2018 – is indeed the one which suits best to the non-EU entrepreneur who plans to move to Italy as investor/working partner of an existing company or to acquire the full share pack of it becoming its CEO. Of course the amount of investment for this visa is quite high: we are looking at least at 500k Euros investment; on the other hand, the opportunity of buying a good profit company connected to the chance to build a cross border business link, together with the favourable tax break also for the profits beside the salary, will probably be able to compensate the initial expenditure. Visa for investors is out of the yearly fixed number of application and, once all its conditions are verified, is quickly issued (30/40 days), moreover, it can be done also by an investor coming from a Country which doesn’t have any kind of agreement with Italy.
Conte’s Government choice is part of the bigger strategic plan of brains and investment attraction policy started two years ago with the introduction of the visa for investors connected to the flat tax benefit (100K Euros or 25K Euros) for the new resident’s income from abroad