Impatriate Workers Tax Regime in Italy: Complete Guide to Taxation, New Rules and Recovery of Overpaid Taxes

What Is the Italian “Impatriate Workers Regime”?

The Italian Impatriate Tax Regime, established under Legislative Decree No. 147/2015, is one of the key instruments introduced to attract qualified personnel, managers, and professionals returning to Italy from abroad.
The regime grants a reduced taxation on employment and self-employment income produced in Italy, incentivising relocation of skilled workers to the country and supporting long-term retention.

A major reform was introduced with Legislative Decree No. 209/2023, applicable from the 2024 tax year onwards.

Evolution of the Impatriate Tax Regime (2015 → 2024 Reform)

Previous Regime (Applicable to individuals relocated no later than 29 December 2023)

The old framework remains applicable to those who transferred their Italian tax residency before December 29, 2023. Key requirements included:

• No tax residency in Italy in the previous two tax periods;
• Commitment to maintain residency in Italy for at least two years;
• Employment performed mainly within Italian territory;
• Taxable base reduced to 30%, or 10% for relocations to Southern Italy.

New Impatriate Tax Regime (In force from 2024)

The reform substantially redefined eligibility criteria and tax benefits.

Tax Advantages

• 50% taxable income reduction (50% exemption);
• Annual tax relief cap: €600,000 of eligible income;
• Duration: 5 years (minimum 4 years of residency required).

Eligibility Requirements

• No Italian tax residence in the three previous tax years;
• Transfer of both tax and civil residency to Italy;
• Work activity carried out mainly in Italy;
• University degree or minimum 24 months documented qualified experience abroad.

Additional Benefit for Parents

Where the taxpayer has at least one minor child (or a child is born/adopted during the incentive period), the taxable base is reduced to 40%.

Incentives for Southern Italy & Entrepreneurial Activity

The regime continues to promote territorial competitiveness:

• Incentives remain for relocation to Southern Italy combined with other tax benefits;
• Relief also applicable to start-up founders or new business activities launched in Italy.

Note: The previous 10% taxable base no longer applies to new relocations but remains valid for taxpayers already qualifying under the old framework.

How to Apply for the Impatriate Regime – Operational Checklist

To benefit from the favourable regime, the taxpayer must:

1. Transfer tax residency to Italy (Art. 2 TUIR);
2. Not have been tax resident in Italy for the previous 3 years;
3. Perform work activity mainly in Italy;
4. Hold a qualifying degree or experience;
5. Opt for the regime via:
   • payroll application by employer, or
   • income tax return (ordinary or supplementary);
6. Maintain Italian residency for minimum 4 years.

Double Tax Treaties & Avoidance of Double Taxation

The regime interacts with international tax treaties, relevant for determining:

• taxation rights between jurisdictions;
• foreign tax credit applicability;
• management of dual-residency scenarios.

Correct treaty application is essential to avoid duplicated taxation.

Recovering Overpaid IRPEF: What if the Employer Did Not Apply the Regime?

A very frequent case among expat workers:

Is it possible to recover taxes already paid without applying the regime?
Yes, in many cases.

If eligible for the regime but:

• the employer did not apply the exemption in payroll;
• no year-end adjustment was carried out;
• the taxpayer did not timely request application;

➡️ the benefit may still be obtained retroactively through tax procedures provided by law.

How to Recover Overpaid Tax

1. Supplementary Tax Return (“Dichiarazione Integrativa a Favore”)

Allows correction of previously filed tax returns to:

• apply the Impatriate regime;
• reduce the taxable base;
• generate an IRPEF credit.

Applicable within the statute of assessment: until 31 December of the 5th year following the original return.

2. Refund Claim – Art. 38 DPR 602/1973

Direct refund request to the Italian Revenue Agency (Agenzia delle Entrate)
within 48 months from payment of tax.

3. Tax Litigation

Frequently required after filing a refund claim, particularly where the Agency disputes entitlement.

Case Law and Precedents (2024–2025)

Recent Supreme Court (Corte di Cassazione) decisions strongly favour taxpayers, overturning restrictive interpretations previously held by the tax authorities.

Key legal principles affirmed:

• Failure to request the regime from the employer does not invalidate the right;
• The benefit arises by law itself, not by employer application;
• The option may be exercised via supplementary return even beyond the standard 90 days;
• Taxpayers may request refund directly from the Revenue Agency;
• What matters are substantial eligibility requirements, not procedural timing.

Recognised cases include:

• Workers who never applied the regime in payroll;
• Workers who omitted option in tax return;
• Refunds granted for up to 4–5 tax years of IRPEF overpayments.

Several rulings from Regional Tax Courts of Lombardy, Lazio, Veneto and Piedmont confirmed tax refunds in contrast to restrictive positions of the Revenue Agency.

Recommended Operational Strategy for IRPEF Recovery

1. Eligibility check for each tax year (residency, activity, non-residency period);
2. Income reconstruction and IRPEF recalculation with/without regime application;
3. Deadline assessment (supplementary return and/or refund claim);
4. Filing:
   • supplementary return for years still open;
   • refund claim for payments within 48 months;
5. Litigation if required – currently supported by favourable case law.

Why the Impatriate Regime Is a Strategic Opportunity

✔ Taxable income reduction up to 50% or 40% with children
✔ Favourable tax management for relocation to Italy
✔ Possibility to recover previously paid taxes
✔ Synergy with start-up and South-Italy investment incentives
✔ Key instrument to attract qualified talent to Italy

Do not leave a tax benefit you are entitled to unclaimed.

Contact Studio Genise for a full eligibility check and assistance with recovering excess IRPEF already paid.