Wealth Planning

non-resident taxpayers
Italian Residency, Wealth Planning

Italian-source income and non-resident taxpayers: how to determine where your tax is due

A widespread misconception leads many foreign taxpayers to assume that, because they live abroad — or because a Double Tax Convention allocates taxing rights to their State of residence — no Italian obligation can arise on income deriving from Italy. The assumption is unfounded, and the assessments issued by the Italian Revenue Agency (Agenzia delle Entrate) in these cases carry significant financial consequences. This note sets out the sequence of questions a non-resident should work through in order to establish where tax on Italian-source income is actually due, and what has to be filed. Step 1 — Confirm your residence status under the reformed rules The threshold question is not where the income arose, but where the recipient is tax resident. Residents of Italy are taxed on their worldwide income under Art. 3 TUIR; non-residents are taxed only on income considered produced in Italy. Legislative Decree 209/2023 rewrote Art. 2(2) TUIR with effect from the 2024 tax period. Under the current text, an individual is resident in Italy if, for the greater part of the tax period — counting fractions of days — any one of the following alternative criteria is met: residence in Italy within the meaning of the Civil Code (habitual abode); domicile in Italy, now defined for tax purposes as the place where the person’s personal and family relations principally develop — a definition that departs from the previous reference to the Civil Code and gives precedence to personal over economic ties; physical presence in Italy. Registration with the register of resident population (anagrafe della popolazione residente) for the greater part of the tax period no longer operates as a conclusive presumption: following the reform it is a rebuttable presumption, and the taxpayer may prove that the formal record does not reflect the factual position. The Revenue Agency issued operating instructions on these criteria in Circular no. 20/E of 4 November 2024. The exercise matters: if any criterion is met, Italy taxes worldwide income, and the analysis that follows does not apply. Step 2 — Identify which income is considered produced in Italy For non-residents, the taxable perimeter is set by Art. 23 TUIR. Under paragraph 1, the following are considered produced in Italy: income from immovable property (redditi fondiari) situated in Italy; investment income paid by the Italian State, by persons resident in Italy, or by Italian permanent establishments of non-residents — expressly excluding interest and other proceeds from bank and postal deposits and current accounts; employment income for work performed in Italy, including the assimilated income referred to in Art. 50(1)(a) and (b) TUIR; self-employment income from activities carried out in Italy; business income from activities carried out in Italy through a permanent establishment; certain other income (redditi diversi) arising from activities carried out, or assets located, in Italy. Paragraph 2 adds a separate category, taxable irrespective of where the underlying activity was performed, provided the payer is the Italian State, an Italian resident, or an Italian permanent establishment of a non-resident. This covers pensions and assimilated allowances, severance indemnities, various forms of assimilated employment income, consideration for the use of intellectual property, patents and trademarks and for industrial, commercial or scientific know-how, and fees paid to non-resident undertakings for artistic or professional services rendered in Italy. A further rule, at Art. 23(1-bis), treats as Italian-source the capital gain on the disposal of shareholdings in non-resident companies whose value derives, for more than half, directly or indirectly, from immovable property situated in Italy at any point in the preceding 365 days, unless the securities are traded on a regulated market. Article 23 lays down the general domestic source rules applicable to non-residents. Income that falls outside it is not taxable in Italy in the hands of a non-resident. Step 3 — Apply the relevant Double Tax Convention Where a Convention is in force between Italy and the State of residence, it allocates taxing rights between the two States and provides the mechanism for relieving double taxation. Its operation is superimposed on Italian domestic law: depending on the category of income, a treaty may reserve taxation to one State alone, or permit concurrent taxation while capping the rate applicable in the source State. Because rates and allocation rules differ from treaty to treaty, the applicable Convention must be consulted in each case; no general rate can be assumed. Access to treaty benefits is documentary. The Revenue Agency approved standard forms by Provvedimento of 10 July 2013 (prot. 2013/84404): Forms A, B, C and D for refunds, exemption from Italian tax, or application of a reduced rate under a Convention, and Forms E and F for the Parent-Subsidiary and Interest and Royalties Directives respectively. The forms require certification of residence by the foreign tax authority, valid from the date of issue until the end of the tax period indicated. One practical point is frequently misunderstood. Where the required documentation is produced, the withholding agent may apply the treaty benefit directly at source, assuming responsibility for its correct application. If no request supported by proper documentation is submitted, the withholding agent will apply the full domestic rate, and recovery then depends on the refund procedure described below. Step 4 — Establish whether an Italian return must be filed Italian law generally requires anyone in receipt of income produced in Italy, including a person resident abroad, to declare it, subject to the exemptions expressly provided. Non-residents use the same Modello Redditi PF as residents; the instructions for non-residents are contained in Fascicoli 1 and 2, with the general exemption cases set out in Fascicolo 1. Certain income is in no case to be declared, and its receipt by a non-resident therefore generates no Italian filing obligation at all. This includes investment income for which, in relation to non-residents, domestic law or the applicable Convention provides for exemption, for a final withholding tax, or for a substitute tax. Filing may also be advisable where it is not compulsory — for instance to claim deductions or allowances not otherwise granted,

Italy VAT Refund
Vat, Wealth Planning

Italy VAT Refund 2026: New Rules for Non-EU Travelers

From 1 July 2026, Italy introduces important changes to its VAT refund (Tax-Free Shopping) system for travellers who reside outside the European Union. The new legislation simplifies customs procedures by allowing a single validation of all electronic tax-free invoices issued to the same traveller, even when different refund operators are involved, provided they participate in the new system. Another significant change is the extension of the deadline for returning customs-validated invoices to retailers, increasing it from four to six months for eligible purchases. These measures are designed to streamline the refund process, reduce administrative burdens and strengthen Italy’s attractiveness as a destination for international shoppers, investors and business travellers. For a detailed explanation of the new rules and their practical implications, read the full article published by We Wealth. Read the full article on We Wealth

international wealth
Family Office, Wealth Planning

New EU rules for vulnerable adults and international wealth

As European families and wealth structures become increasingly international, the protection of vulnerable adults is emerging as a key legal and governance issue. The new EU Regulation introduces a harmonised framework for the recognition of protective measures and powers of representation across Member States, reducing legal uncertainty and facilitating the management of cross-border assets. The reform is expected to play a significant role in the future of wealth planning, family governance and international asset protection. Read the full article on We Wealth:  Read the full article Paolo Gaeta Chiara Pascale Paolo Gaeta & Associati

Foundations, Wealth Planning

UAE Foundations: the Wealth Planning Tool Italian Clients Are Overlooking

In recent years, the United Arab Emirates have ceased to be perceived merely as a “business-friendly” jurisdiction. They are increasingly emerging as a legal laboratory of interest for international wealth planning. In this context, the UAE foundation deserves particular attention as a vehicle which, if properly structured, can offer robust governance and effective asset segregation.Since 2017, more than 2,200 foundations have been established across the three main UAE regimes — RAK ICC, ADGM and DIFC — with 848 new registrations recorded in 2025 alone. What is a UAE Foundation and how does it differ from a trust From a legal perspective, a RAK ICC foundation is a legal entity with its own separate legal personality, distinct from that of the founder and other involved parties. It is designed to hold and manage assets in accordance with the purposes set out in its charter and by-laws, within a long-term governance and succession framework. A foundation is not typically established to carry out commercial activities. The RAK ICC framework expressly provides that any such activities must be merely ancillary or incidental to its objectives. In practice, it can act as a central governance platform for family wealth, shareholdings, real estate, financial portfolios or philanthropic projects, without being confused with the underlying operating business. From an operational standpoint, the RAK ICC regime provides for: a minimum initial capital of USD 100 the appointment of a Registered Agent at least two Council Members the possibility to appoint a Guardian in certain cases a limited level of public disclosure restricted to essential registry data, with the remaining documentation kept confidential except where disclosure is required by competent authorities The 2025 RAK ICC Reforms: What Has Changed The amendments that came into force on 31 July 2025 represent a significant development. They move in the same direction as reforms already observed in the DIFC in 2024, confirming a broader trend toward convergence among UAE regimes and alignment with international private wealth planning standards. Enhanced cross-border protection (firewall provisions) RAK ICC has strengthened its firewall provisions: courts are not required to recognise or enforce foreign judgments that are inconsistent with the foundation regime. The same principle extends to founders, contributors, council members, guardians and qualified recipients. In particular, succession rights arising under foreign law in respect of assets of a living person are not recognised within the RAK ICC framework. Creditors: defined perimeter and three-year limitation period The new rules introduce a three-year limitation period to challenge the establishment of a foundation or the transfer of assets to it. More importantly, they clarify that, where claims are upheld, remedies are limited to the specific transferred asset — or its proceeds — and do not automatically affect the entire structure. This significantly improves clarity and manageability of risk exposure. Protection against coercion (duress) The amendments introduce explicit protection against requests, orders or pressures from parties acting under duress or pursuant to measures outside the competent jurisdiction. Foundation stakeholders are required to disregard demands or actions that are inconsistent with the powers conferred by the charter or by-laws. This provision reinforces the internal autonomy of the structure in distressed scenarios. Strengthened arbitration framework While RAK ICC continues to allow the choice between DIFC Courts and ADGM Courts, the 2025 reforms significantly enhance the role of arbitration. Arbitral tribunals are granted powers equivalent to those of courts in matters relating to the administration of the foundation, including representation of minors, unborn beneficiaries or unascertained persons. For complex family wealth structures, the advantage is not only procedural but also reputational. Clarification on assets held as trustee The 2025 reform further clarifies that assets held “on trust” by a foundation remain subject to the terms of the trust and do not form part of the foundation’s own assets. This is a technically important point for private trustee foundation structures. The UAE Tax Framework: Corporate Tax and Family Foundations The UAE federal tax framework has become more articulated and, in many respects, more transparent. The Federal Tax Authority has issued guidance on the taxation of Family Foundations, clarifying that a foundation may — subject to the conditions set out in Article 17(1) of the Corporate Tax Law — apply to be treated as an Unincorporated Partnership, i.e. as a fiscally transparent entity for UAE Corporate Tax purposes. If the application is approved, the foundation is not taxed at the entity level, and income, assets and liabilities are attributed to the beneficiaries in accordance with applicable rules. The main conditions include: the foundation must be established for identified or identifiable natural persons and/or public benefit entities its primary activity must consist of holding, investing, distributing or managing savings and investment assets it must not carry out activities that would constitute a commercial business if performed directly by an individual its principal purpose must not be the avoidance of Corporate Tax Foreign entities — including foundations, trusts or similar structures — with a presence or nexus in the UAE may also access the same treatment, subject to meeting the relevant requirements. The Italian Perspective: What Italian-Resident Clients Need to Consider This is the area where Italian clients must exercise particular care — and where the difference lies between a structure that is merely attractive on paper and one that is truly sustainable. Where the founder or beneficiaries of a UAE foundation are tax resident in Italy, a number of rules come into play which require an integrated analysis and cannot be overlooked: Tax monitoring (RW reporting): assets held through a foreign foundation may fall within reporting obligations, depending on the level of control and the nature of the underlying assets. IVAFE: the tax on foreign financial assets may apply, depending on how the foundation is classified under Italian law. Residence of founder and governing bodies: the location of decision-making functions may be relevant in determining the effective tax residence of the structure. Legislative Decree No. 139/2024: the recent reform of trust taxation in Italy introduces new criteria that, by analogy, may also influence the

Family Office, Uncategorized, Wealth Planning

New Guide: Family Office Guide

Today, managing a family’s wealth has become increasingly complex. It is no longer just about investments, but about coordinating people, aligning objectives, and making decisions that will shape the family’s future. This is precisely where a Family Office comes into play: providing a unified and structured approach to wealth management, with the aim of preserving, growing, and transferring assets across generations in a thoughtful and informed manner. In this guide, we explain in clear and practical terms what a Family Office is, when it becomes truly necessary, and the key benefits it can offer — from greater control and improved organization to risk mitigation and more effective governance of the relationships between family, business, and wealth. A well-designed Family Office helps prevent costly mistakes, reduces the likelihood of conflicts, and brings clarity to critical moments such as generational transitions or phases of significant growth. If you are considering how to better structure your wealth or prepare it for the future, this guide is an ideal starting point. Download the guide Should you wish to explore this further, we would be pleased to support you in designing a tailored solution that reflects the specific needs and long-term vision of your family.

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