Skip to content With the reply to Tax ruling No. 703 published on October 12, 2021, the Italian Revenue Agency specified that the option to extend the inpatriates tax relief for a further five years can only be exercised once the first five-year period has expired.
The extension for an additional 5-year period of the special tax regime for inpatriate workers may be exercised, provided that the requirements of Article 1, paragraph 50 of Law no. 178/2020 are met:
- Having been registered with the Register of Italian Residents Abroad (AIRE);
- Being nationals of Member States of the European Union;
- Having already transferred their residence before 30 April 2019 and who are making use of the special tax relief for inpatriates under art. 16, D.lgs n. 147/2015 as of the date of 31 December 2019
- Having at least one underage child including in pre-adoptive foster care;
- Becoming or having become the owner of at least one residential property situated in Italy, either after the arrival to Italy, or during the 12 months preceding the arrival, or within the 18 months after the application for the extension. The real estate unit can also be purchased by the spouse, the cohabitant partner or the children even in co-ownership.
Conditions of extension of the inpatriates tax relief
As reported in the response to the tax ruling no 703, the Italian Revenue Agency has therefore emphasized that, according to article 5 paragraph 2-bis of the Decree Law 34/2019, Italian citizens who have not been registered within AIRE are excluded from the possibility to exercise the option for the extension of the tax relief. This statement does not correspond to the provisions of Article 16 paragraph 5-ter of Legislative Decree 147/2015 which had allowed access to the regime even in the absence of AIRE registration, where it is possible to prove to have been tax resident abroad under a Convention against double taxation. Following the publication of Circular No. 33/2020, this possibility was also granted to individuals who moved to Italy before 30th April 2019.
Regarding the period of exercise the extension of the regime, the Italian Revenue Agency underlines that the option cannot be exercised before the first five years of use of the inpatriates tax relief; in other words, the option for the extension of the tax relief for workers who transferred to Italy before 30/04/2019 must be applied within 30 June of the year following the one in which the prior period expires.
Who is excluded from excercising the option
In conclusion, they are excluded from the possibility of exercising the option referred to Article 1, paragraph 50, of the Budget Law 2021:
- Professional sportsmen and women;
- Individuals who have moved to Italy since 30 April 2019;
- Italian citizens, returned within 29 April 2019, not registered with the AIRE;
- Non-EU nationals.
Impatriate tax regime for british citizens
The Revenue Agency also clarified its position regarding the recognition of the impatriate tax regime for those British citizens who had benefited from the facility as at 31 December 2019, and who met the requirements to request its extension.