{"id":4697,"date":"2024-05-15T14:59:02","date_gmt":"2024-05-15T14:59:02","guid":{"rendered":"https:\/\/ciccioriccioassociati.com\/?p=4697"},"modified":"2024-05-29T18:21:56","modified_gmt":"2024-05-29T18:21:56","slug":"italian-new-inbound-workers-regime","status":"publish","type":"post","link":"https:\/\/ciccioriccioassociati.com\/en\/italian-new-inbound-workers-regime\/","title":{"rendered":"Italian New Inbound Workers Regime"},"content":{"rendered":"

Foreword <\/strong><\/p>\n

With the Legislative Decree no. 209 of 28 December 2023, the Italian inbound workers regime has changed once again.
\nThe amendments to the regime have the effect of rendering the regime less favourable by both reducing the exemption and providing for more stringent criteria.<\/p>\n

Previous foreign tax residence requirement<\/strong><\/p>\n

One of the main differences with the previous regime is related to the more stringent subjective scope.
\nIndeed, the previous regime could have been enjoyed by any individual who had been tax resident outside of Italy for at least two fiscal years.
\nOn the contrary, the new regime requires that the inbound workers had to be tax resident abroad for at least 3 fiscal years. Higher thresholds are provided where the worker that transfers his\/her tax residence to Italy keeps working for the same employer he\/she was working for when resident abroad.
\nIn particular, if the worker carries out his\/her activity in favour of the same person (or an entity part to the same group) he\/she was working for before moving to Italy, his\/her previous stay outside of Italy needs to be equal to six years at least.
\nThe threshold goes up to seven fiscal years if the worker was previously employed in Italy by such employer.
\nThis is a new requirement as it was not present in the previous regime. Nonetheless the aim is clearly to avoid granting the benefit of the regime to workers that moved to Italy (or moved away from Italy and then came back) without actually changing job in order to avoid companies or group to allow their workers to move Country only to benefit from a more favourable tax regime.<\/p>\n

Commitment to stay in Italy\u00a0<\/strong><\/p>\n

Another requirement for the new regime to apply is that the inbound worker has to commit to remain tax resident in Italy for at least four fiscal years. This threshold has been doubled as the previous regime only provided for a two-year commitment.
\nIf the relevant worker moves out of Italy before the fourth year, then the regime ceases to apply retroactively and the Italian Tax Authorities shall claim back all the benefits that the worker has received plus interest. No penalties are provided for by the law in this case.<\/p>\n

Income exemption and threshold\u00a0<\/strong><\/p>\n

The old inbound workers regime provided for a 70% income exemption which might be raised to 90% if certain conditions were met (i.e. where the tax residence was moved to the southern part of Italy).
\nThe new inbound workers regime, instead, provides for a 50% income exemption rate which might be elevated to 60% where the taxpayer moving his\/her residence to Italy has underaged dependent child.
\nAnother substantial difference between the old and new inbound workers regime lies in its income threshold.
\nThe old regime did not provide for any maximum threshold, meaning that the exemption ratio could have been applied to any amount of income. On the contrary, the new regime also provides for an income threshold of 600,000 Euros per fiscal year. When the income derived is higher than such threshold, the exemption does not apply.
\nFinally, the previous regime applied with respect to employment income, income assimilated to employment income (e.g. directors\u2019 fees) and certain kind of self-employment income (i.e. income derived by arts and professions). The old regime, on the contrary, was applicable to a broader range of kind on income, including business income and all the kind of self-employment income.<\/p>\n

Requirements related to the activity of the worker\u00a0\u00a0<\/strong><\/p>\n

The previous and the new regime overlap when it comes to the location where the activity may be carried out. Indeed, in both the regimes it is necessary that the work activity is performed in Italy for the greater part of the fiscal year.
\nHowever, differently from the previous regime, the new inbound workers regime provides for a limitation with respect to kind of workers which are eligible for it. The new regime can only be enjoyed by certain highly qualified professional.<\/p>\n

Specific education titles or qualifications<\/strong><\/p>\n

One of the new requirements provided for by the amended rule is that only workers respecting certain education criteria are allowed to benefit from the regime.
\nIndeed, the new inbound workers regime only applies to workers that are highly specialized or qualified. In more details, to benefit from the exemption the workers must either:<\/p>\n