Italy's Impatriate Tax Regime 2026: Complete Guide to Tax Relief, New Rules and IRPEF Refunds

What the Impatriate Regime Is

The tax regime for impatriate workers is a tax incentive that grants a significant reduction of taxable income on employment and self-employment income earned in Italy by people who move their residence to Italy from abroad.

Introduced by Article 16 of Legislative Decree 147/2015 and extensively reformed by Legislative Decree 209/2023, it has a dual purpose: attracting qualified talent and skills, and encouraging Italian professionals who have gained experience abroad to come back.

The logic is simple: if you choose Italy as the place where you work, you pay tax on only part of your income — 50% of it, or 40% if you have minor children.

How Much Can You Save? A Practical Simulation

To show the real impact of the regime, here are three simulations on employment income, with IRPEF calculated using the 2026 progressive rates (regional and municipal surcharges excluded).

Scenario A — Income of €60,000

Scenario B — Income of €90,000

Scenario C — Income of €150,000

How the Rules Have Evolved: from 2015 to the 2026 Reform

The Previous Regime (Moves up to 29 December 2023)

If you moved your tax residence to Italy by 29 December 2023, the original rules still apply. Here is a summary.

Eligibility requirements

• Not resident in Italy in the two tax years before the move
• Commitment to keep Italian residence for at least two years
• Work carried out mainly in Italy

Tax benefits

• Reduced taxation: only 30% of income taxable (70% exempt) for moves to the rest of Italy
• Only 10% of income taxable for those who moved to Southern Italy
• Duration: 5 years, extendable under certain conditions (purchase of a home, minor children)

The New Impatriate Regime from 1 January 2024

Legislative Decree 209/2023 completely redefined the requirements and tax benefits. The new regime is more selective, but still offers a significant tax advantage.

Tax benefits

• Taxable income reduced to 50% of employment income (tax is effectively paid on half of it)
• With at least one minor child: taxable income reduced to 40%
• Maximum eligible income: €600,000 per year
• Duration: 5 years, with an obligation to keep Italian residence for at least 4 years

Eligibility requirements

• Not resident in Italy in the 3 previous tax years (7 if you return to work for the same foreign employer)
• Move your tax and registered residence to Italy
• Work mainly in Italy
• Hold a university degree or have at least 24 months of qualified experience abroad

Side-by-side comparison of the two regimes

2025-2026 Updates: Clarifications and Legislative Changes

Decree-Law 38/2026 — No combining with the new-residents regime

The main legislative change is Decree-Law no. 38 of 27 March 2026, converted by Law no. 88 of 22 May 2026. Article 2 of the decree amends paragraph 154 of Article 1 of Law 232/2016, stating that from tax year 2027 the new-residents regime (Article 24-bis of the Italian Income Tax Code, TUIR) can no longer be combined with either the old impatriate regime (Article 16 of Legislative Decree 147/2015) or the new one (Article 5 of Legislative Decree 209/2023).

Revenue Agency clarifications — 2025-2026 tax rulings

Ruling no. 82/2026 — Remote work for a foreign employer. The case concerned a taxpayer coming from Finland, with more than 30 years of continuous residence abroad, who returned to Italy to work remotely for the same foreign employer. The Agency confirmed access to the regime, provided the work is carried out mainly in Italy. The long period of residence abroad (more than the 7 years required when staying with the same employer) was decisive.

Ruling no. 12/2026 — Formal vs. actual residence. The Agency granted access to the regime to a taxpayer who, while formally resident abroad, had in fact been working in Italy for a long time. When the tax residence was moved, the qualifying periods of non-residence were calculated retroactively on the basis of the formal residence, allowing access to the benefit.

Rulings no. 263 and 264/2025 — Parallel collaborations and EU staff. Ruling no. 263/2025 confirmed that the regime can also be used by people who keep existing collaborations (for example with Italian universities) alongside their new main employment. Ruling no. 264/2025 clarified the limits for former employees of European institutions such as the EIB and the EBRD, because of Article 13 of the Protocol on the Privileges and Immunities of the European Union, which affects how that income is treated for tax purposes.

The 7-year rule for staying with the same employer

If you return to Italy to work for the same employer you worked for abroad, the minimum period abroad is 7 years (Article 5(1)(b) of Legislative Decree 209/2023). This rule is designed to exclude temporary secondments and returns of convenience, so that the benefit goes to people who have built a real link with the foreign labour market.

Double Tax Treaties: How They Interact with the Regime

The impatriate regime applies to income earned in Italy. Coordination with international double tax treaties is essential to make sure the same income is not taxed in two countries.

Key points of coordination

Germany. The Italy-Germany treaty (Law 459/1992) gives the state of residence the exclusive right to tax employment income when the work is carried out in that state. For an impatriate who has returned from Germany and works in Italy, the Italian income is taxable only in Italy: no double taxation, and the regime applies in full.

United Kingdom. The Italy-UK treaty, updated after Brexit, follows similar criteria. Employment income for work physically carried out in Italy is taxable in Italy. Any private pension built up in the United Kingdom follows specific rules that must be checked case by case.

United States. The US case is more complex: US citizens are taxed in the United States wherever they live (worldwide taxation). This can lead to residual double taxation, which the foreign tax credit under Article 165 TUIR helps to reduce, but it requires a specific analysis with a professional qualified in both jurisdictions.

Recovering Overpaid IRPEF

One of the most common cases we handle involves taxpayers who were entitled to the impatriate regime but never used it — because their employer did not apply it, because they did not know about it, or because they did not apply in time.

Can you get a refund?

Yes, in many cases you can. Recent Italian Supreme Court case law has sharply limited the Revenue Agency's restrictive approach, stating that the right to the benefit comes from the law, not from the request to the employer.

Recovery tools

Amended tax return in your favour (Article 2(8-bis) of Presidential Decree 322/1998): lets you correct the returns of previous years to apply the regime retroactively, reduce the declared taxable income and generate an IRPEF credit that can be offset or refunded. Deadline: 31 December of the fifth year after the original return.

Refund claim under Article 38 of Presidential Decree 602/1973: lets you ask the Revenue Agency directly for a refund of the tax overpaid. Deadline: 48 months from the payment.

Tax appeal: if the claim is rejected or not answered, you can appeal to the Tax Court, where case law is now well established and favourable to taxpayers.

Favourable Supreme Court Case Law (2024-2026)

Principles established by the Supreme Court

Results in the lower tax courts

The Tax Courts of Lombardy, Lazio, Veneto and Piedmont have granted refunds even against the Revenue Agency's position, upholding the recovery of 4-5 years of IRPEF for taxpayers who had never had the regime applied to their pay, including cases where the option was exercised late in the tax return.

Step-by-Step Procedure to Recover IRPEF

Eligibility checklist

• Tax residence moved to Italy (Article 2 TUIR)
• Not resident in Italy in the previous 3 years (or 7 years with the same employer)
• Work carried out mainly in Italy
• University degree or at least 24 months of qualified experience abroad
• Option exercised through the employer or in the tax return
• Italian residence kept for at least 4 years

Recovery procedure

Why the Impatriate Regime Is a Strategic Opportunity

Frequently Asked Questions (FAQ)

The questions we are asked most often, with direct answers updated to June 2026.