Moving your tax residence out of Italy: the rules since 2024, the mistakes to avoid and what really changes

The rules since 2024: four criteria, one is enough

Under Italy's international tax reform in force since 1 January 2024, you're tax resident in Italy if for most of the year, i.e. at least 183 days (184 in leap years), even just one of these criteria applies:

1. Registration in an Italian municipality's resident population register;
2. Domicile in Italy, i.e. where your personal and family relationships are mainly based;
3. Residence in Italy under the civil code, i.e. your habitual abode;
4. Physical presence in Italy: the new objective test, counting days spent in the country, including part days, whatever the reason.

The operational guidance is in the Italian Revenue Agency's circular 20/E of 4 November 2024.

Why AIRE alone isn't enough

Registering with AIRE, the register of Italians living abroad, removes the first criterion. But if your family stays in Italy, or you spend more than half the year here, you're still resident under one of the other three. Conversely, staying registered in an Italian municipality counts against you: it's the first thing to sort out when you leave.

The most common mistakes

• Leaving the centre of your life in Italy: a spouse and children who stay, your main home, your closest relationships. Domicile looks at personal and family ties, not just paperwork.
• Underestimating days of presence: under the new test, frequent trips back and long holidays in Italy add up and can cross the threshold. Keep track of dates with tickets and stamps.
• Moving mid-year without a plan: the year you move is the most delicate. It's worth discussing the date with a professional.

What changes once you're non-resident

• Income: Italy stops taxing your worldwide income and only taxes income arising in Italy, for example rent from an Italian property and, depending on the treaty with your new country, some pensions paid from Italy. Other income is declared where you live.
• Reporting of foreign assets: the RW form and the taxes on assets held abroad apply to residents; as a non-resident they no longer apply to you.
• Investments: some rules change for non-residents, on both Italian and foreign accounts. Tell your bank and broker about your new residence, and check how your new country will tax you before selling or moving your portfolio.
• INPS pension: you keep accruing it and can receive it abroad. How any foreign contributions add up is explained in the guide on the Italian pension with contributions abroad.
• Healthcare: moving abroad generally ends your routine cover under Italy's national health service: you need cover in your new country.

The role of tax treaties

If two countries consider you resident in the same year, the double taxation treaty between them decides which prevails, looking in order at permanent home, centre of vital interests, habitual abode and nationality. So besides Italy's rules, it's worth reading those of your destination country and the treaty that links them.

The checklist before you leave

1. Register with AIRE through the consulate within 90 days of moving.
2. Count your days: keep a record of flights and stays in Italy, to prove presence below 183 days.
3. Keep evidence of your life abroad: rental or purchase contract, utilities, residence permit, local tax registration.
4. Check the double taxation treaty between Italy and your new country, especially for pensions, rent and investments.
5. Tell your bank and brokers about the change of residence.
6. Plan your pension and savings: if you'll work abroad, foreign contributions may not add up with Italian ones.