Italy, with its rich cultural history, Mediterranean climate, and delicious cuisine, is a consistently popular destination for foreign visitors. Whether it’s for a holiday or for a longer stay, it’s no wonder the country is so appealing. Italy has a diverse economy, providing income opportunities across various sectors.
Non-residents earning income from Italian sources must file annual tax returns, depending on their specific circumstances. Declaring your revenue to the Italian tax authorities is a process that involves several steps and adherence to regulations.
At Remitly, we have organized the following information to help you file taxes as a non-resident. Here, we cover who needs to file, what papers you need, when to file, and how to do it. This can help you remain compliant and avoid penalties.
Who needs to file a tax return in Italy?
In Italy, the official name for income tax is “imposta sul reddito delle persone fisiche” (IRPEF). Plan to file a personal income tax return if you’re making money in Italy but don’t live there full-time.
If you don’t work for an Italian company or employer that automatically withholds income tax, then you will submit your own taxes. The Agenzia delle Entrate (Italian Revenue Agency) says that the following type of income requires an IRPEF:
- Business income
- Self-employment income
- Rental income for both buildings and land
- Pensions or retirement income
- Financial investments or capital gains
- Miscellaneous income
According to Italian tax law, non-residents are only taxed on the income they generate in Italy. This distinction with Italian income tax liability depends on how much time you reside in the country.
The Italian government declares you a tax resident after being in Italy for over 183 days in a calendar year. If so, whether you’re European or a non-EU citizen, Italian tax residents must also make social security contributions.
What documents do you need to file taxes as a non-resident in Italy?
Non-residents in Italy often file taxes using the Redditi PF form (Modello Redditi PF). If you expect a refund, you can apply your earnings from this form to go towards the next tax year.
Documents help prove compliance with the tax system when filing your personal income tax in Italy. Here’s a quick list of what non-residents need to file taxes:
- Proof of identification: Either your passport or Italian identification card.
- Tax code: Be sure to have your Italian tax identification number (Codice Fiscale).
- Income documentation: Documents here depend on your situation. If you are a digital nomad in Italy or self-employed, pay stubs and employment contracts will do. Along those lines, bring your VAT number and registration documents. For property income, rental agreements can suffice. Retirees need pension statements, while investors need statements or income certificates.
- Tax return form: This is the completed Redditi PF form.
- Proof of foreign residence: For non-resident tax purposes, you need to prove your residence outside of Italy. Achieve this with a utility bill, lease agreement, or foreign tax return.
- Proof of Italian source income: Don’t forget to show concise records of your Italian-based income.
- Deductions: Bring all of your receipts or documentation for qualified deductible expenses.
- Bank account information: Whether you expect a refund or to make a payment, know your banking details.
- Past tax returns: If you have filed taxes before in Italy, it wouldn’t hurt to have copies of your previous returns.
- Double taxation agreements: You may be eligible to claim tax relief if Italy has a double taxation agreement or tax treaty with your country of residence. Any relevant documentation is useful for your Italian tax return, especially to avoid double taxation. See if Italy has a tax treaty with your home country here.
How do you get your Codice Fiscale (Italian Tax Code)?
The process for obtaining a Codice Fiscale is straightforward, and there are various ways to apply:
- Apply in person at any local office of the Agenzia delle Entrate. Take your passport and a completed application form (Form AA4/8).
- If you are not in Italy, you can get your Codice Fiscale through an Italian consulate in your country. You will need your passport and the application form. The consulate will send your application to the Agenzia delle Entrate and you will receive the code by mail or email.
- Some consulates allow you to apply for a Codice Fiscale online or by mail. Check your country’s Italian consulate for information.
How can you file your tax return in Italy?
One option to file your Italian income tax is by submitting the Redditi PF form electronically. You can do this through the Agenzia delle Entrate’s online tax portal. Other options include authorized intermediaries or sending paper copies through the post.
What are the key tax deadlines in Italy?
The Redditi PF deadline is October 15 of the following fiscal year if done electronically or via intermediary. If you are abroad and cannot submit the form electronically, you have until November 30 to send it by registered post.
Are there penalties for filing taxes late in Italy?
Try to file your annual tax return on time in Italy to avoid possible fines. The amount of the penalty depends on how long after the deadline you file your taxes. According to Italian tax law, the range of late filing penalties includes:
- Within the first 90 days after the deadline: The penalty ranges from €250 to €2,000.
- After 90 days: The penalty could be between 120% and 240% of the unpaid tax, with a minimum penalty of €250.
What are the tax rates and deductions for non-residents in Italy?
Italy applies progressive income tax rates to both resident individuals and non-residents. In 2024, the following rates apply:
- Up to €28,000: 23%
- €28,001 to €50,000: 35%
- Over €50,000: 43%
Despite the paperwork involved, there are various tax deductions in Italy. Taxpayers reduce their tax liability with the following expenses:
- Healthcare expenses: These include costs for medical treatments, surgeries, dental care and prescription medications. Any expenses for medical equipment like wheelchairs or hearing aids are deductible, plus health insurance premium payments.
- Pension expenses: If you contribute to an Italian pension scheme, you may be able to deduct these contributions up to a certain limit.
- Educational expenses: Some university and private school fees are valid expenses. Connected to this are costs for educational materials and courses, if they relate to job training or professional development.
- Business expenses: If you are self-employed, filing the VAT return could entitle you to a partial refund of VAT paid throughout the year.
- Mortgage interest: The interest you pay on your mortgage on your primary residence can help reduce your tax liability in Italy.
- Charity contributions: Like other countries, donations to a charity, non-profit organization, or religious institution are tax-deductible expenses.
- Insurance premiums: This includes life insurance, accident insurance and long-term care insurance.
- Family member expenses: Italy allows you to deduct daycare and babysitting services for children. Costs for taking care of the elderly are equally deductible if that person depends on you as the taxpayer.
- Energy renovations: Solar panel installation and insulation upgrades are tax-deductible expenses for taxpayers in Italy. Structural renovations and repairs to improve your home’s energy efficiency are also included.
What are common mistakes to avoid with Italian taxes?
Below are some common errors for non-residents filing taxes in Italy:
- Not declaring all your Italian income: Make sure to declare all of your Italian income.
- Not knowing about double taxation treaties: Check double taxation treaties with Italy and your home country to avoid overpaying taxes.
- Filing your taxes incorrectly: Incorrect filing could lead to delays and possible fines. Consider consulting a professional to help you with your tax return.
- Missing deadlines: Take note of deadlines and file on time to avoid penalties.
- Not claiming available deductions: Do your research to avoid missing any deductions.
Where can I get help with filing taxes as a non-resident in Italy?
- Consult a tax professional: If in doubt, contact a tax advisor or tax consultant. They will ensure the whole process runs smoothly.
- Agenzia delle Entrate: Visit the official website of the Italian Tax Authority for detailed information.
- Contact your country’s embassy: Your home country’s embassy or consulate may be able to offer more specific guidance.
- Government helplines: Call the Agenzia delle Entrate from Italy on 800 90 96 96 (toll-free from a landline) or 06 97617689 (from a mobile); or +39 06 96668907 from abroad. For Social Security queries, you can call the Istituto Nazionale della Previdenza Sociale (Italian National Social Security Institute) from Italy on 803 164 (toll-free from a landline) or 06 164 164 (from a mobile).
- SPID: Sistema Pubblico di identità Digitale, Italy’s public digital identity system, may have helpful resources for online procedures.
The tax filing process in Italy involves multiple steps and regulations. For assistance or clarification on your specific circumstances, please contact Italian tax law professionals for consultation.
FAQ
How do you file taxes as a non-resident in Italy?
One way is to submit the Redditi PF form electronically. You can do this through the Agenzia delle Entrate’s online tax portal. Alternatively, there are authorized intermediaries or you can send paper copies through the post.
Do I have to report income from other countries?
Yes, you have to report worldwide income from non-Italian sources. However, only the income generated in Italy is subject to Italian taxation, not the foreign income. Non-residents in Italy must file a tax return for any income earned from Italian sources.
Can I file my Italian taxes in English?
No, it is not possible to file your Italian taxes in English. Tax returns in Italy need to be completed in Italian. Official forms and documentation from the Italian Revenue Agency are not available in other languages.
