The double taxation treaty applies between the UK and Italy. This treaty is there so you will avoid being taxed twice on any assets in two countries. You should contact the Inspector of Taxes who will send you a P85 to fill in. The inspector of Taxes will require the following…
- Proof that you are leaving the UK jurisdiction.
- Evidence of having sold a UK house and purchased or a renting a property in Italy
- P45 from you last employer (this applies if you are planning to work Italy)
- Proof of employment from an Italian employer (again if you are planning to work in Italy).
For more details contact the Inland Revenue website, they will also have more advice on moving abroad…
www.inlandrevenue.gov.uk
Tax Number (codice fiscale).
In order to do any financial transaction in Italy you will need a tax number. You will become liable for tax if you work for more than 183days.
Capital gains Tax and wealth tax.
There is no capital gains and wealth tax on property. Inheritance and gifting under the value of €80,760 is shielded from tax. There are also many exemptions on Inheritance tax. Please seek legal advice in regards to this matter.
Income Tax
IRPEF (imposta sui redetti delle persone fisiche) is a progressive tax.
Anything up to €15,000 will be taxed at a rate of 23%.Between €15,001 and €29,000 will be taxed at a rate of 29%. €29,001 up to €32,600 will be taxed at a rate of 31%. €32,601 up to €70,000 will be taxed at a rate of 39%. Anything over €70,001 will be taxed at 45%.
Theses rates will vary depending on both the area and region you live. In Italy your possessions as well as your income are taxable.
ICI (imposta Comunale sugli Immobli)
This is a property tax levied by the local tax office (known as the commune). The rate of this tax depends on the value of your house. This tax is somewhat similar to council tax in the UK. This is normally paid in June a December (two annual payments)
Registration tax (impost di registro).
This is the main tax on a property. The rate will vary between 0% up to 10% depending on the value of the property.
Land registry.
Non-residents will have to pay 11% of the value of the property.