Private client law in Italy: overview

A Q&A guide to private client law in Italy.

The Q&A gives a high level overview of tax; tax residence; inheritance tax; buying property; wills and estate management; succession regimes; intestacy; trusts; co-ownership; familial relationships; minority and capacity, and proposals for reform.

To compare answers across multiple jurisdictions, visit the Private Client Country Q&A tool.

The Q&A is part of the multi-jurisdictional guide to private client law. For a full list of jurisdictional Q&As visit

Guglielmo Maisto, Maisto e Associati


Tax year and payment dates

1. When does the official tax year start and finish in your jurisdiction and what are the tax payment dates/deadlines?

The tax year for individuals corresponds to the calendar year (1 January to 31 December).

All resident and non-resident taxpayers must file an annual tax return for any income that is subject to personal income tax (Imposta sul Reddito delle Persone Fisiche) (IRPEF). In some cases, individuals may not have to file an annual tax return if their income is:

  • Exempt income.

  • Subject to a final withholding tax.

  • Subject to some other marginal exclusion.

Taxpayers who are required to keep accounting books must file a tax return (even if they do not derive any taxable income).

Income tax returns must be filed by 30 September each year, for the amount of income cashed (or, in limited circumstances, accrued) during the previous tax year. Two advance payments of income tax must be made during each tax year by:

  • 16 June.

  • 30 November.

The final tax liability for the year concerned is shown in the annual return. The balance of the tax due must be paid by 16 June of the following year.

Tax payment dates may change each year.


Domicile and residence

2. What concepts determine tax liability in your jurisdiction (for example, domicile and residence)? In what context(s) are they relevant and how do they impact on a taxpayer?

Tax residents are subject to tax on their worldwide income. Individuals who are not tax resident in Italy are subject to tax on their Italian-source income only.

An individual is tax resident in Italy for income tax purposes if, for the major part of the tax year, he has one of the following:

  • Domicile in Italy.

  • Residence in Italy.

  • Registration in the resident population registry.

If one of these three conditions is fulfilled for most of the tax year (calendar year), the individual is deemed to be a resident of Italy for the whole tax year. However, if all three conditions are not met, the individual is regarded as a non-resident for the whole tax year (that is, there is no split-year concept for residence purposes under domestic law).


The domicile of an individual is the place where he has established his main seat of business and interest (Civil Code). Domicile is primarily a legal concept, irrespective of an individual's physical presence. Under the case law of the Italian Supreme Court, domicile refers to the place where the following are mainly situated:

  • Social and family interests.

  • Business interests.


Residence is defined as the place where an individual has his habitual abode. Residence can be ascertained by the habitual and voluntary dwelling of an individual in a given place, depending on both the:

  • Factual habitualness.

  • Subjective intention to use the property habitually.

Habitualness is not to be interpreted as the duration of use or frequency of physical presence but rather what the individual perceives and intends to be habitual, even if the individual intends to come back to use it in the future and continues to regard it as his habitual abode.

This means that the property can also be used non-continuously or in separate periods of time (or can even be not used at all for a certain period of time) if it is understood that the individual intends to come back to use it in the future and continues to regard it as his habitual abode.


The criterion of the registration in the resident population registry is a purely formal requirement.


Double residence issues can be resolved by applying the applicable tax treaty (see Question 14).


Taxation on exit

3. Does your jurisdiction impose any tax when a person leaves (for example, an exit tax)? Are there any other consequences of leaving (particularly with regard to individuals domiciled in your jurisdiction)?

There are no exit taxes or similar charges if an Italian resident moves to another jurisdiction.

If an Italian citizen removes himself from the residents' register and moves to a tax haven jurisdiction as defined in the Ministerial Decree of 21 November 2011 (including for instance Switzerland, Liechtenstein, Monaco and Hong Kong) the individual is deemed resident in Italy unless proof to the contrary is provided.


Temporary residents

4. Does your jurisdiction have any particular tax rules affecting temporary residents?

Italy does not have a concept of temporary residence.


Taxes on the gains and income of foreign nationals

5. How are gains on real estate or other assets owned by a foreign national taxed? What are the relevant tax rates?

Real estate property

Non-resident individuals (who are not carrying on any business) are subject to income tax on capital gains on the sale of real estate property located in Italy if the property is purchased or built less than five years before the transfer. A sale of real property owned for more than five years is not subject to tax. Furthermore, a sale of inherited real estate is not subject to tax.

Capital gains are taxed at ordinary progressive rates (see Question 6, Progressive tax rates). However, instead of paying tax on capital gains on real estate, the taxpayer can pay a substitute tax of 20% by submitting a wish to do so to the Public Notary responsible for making the sale.


A non-resident individual's capital gain on the sale of non-substantial participations in Italian companies or partnerships is subject to a final substitute tax of 26%. However, capital gains realised by non-resident individuals on the sale of non-substantial participations in listed companies are not subject to tax.

Exemptions are available for investors resident in countries allowing adequate exchange of information. Treaty exemptions may apply.

Non-resident individuals' capital gains on substantial participations are included in their taxable income for 49.72% of their amount and subject to income tax at progressive rates (see Question 6, Progressive tax rates), unless a treaty exemption applies. Substantial participations are participations that represent either more than:

  • 2% of the voting rights or 5% of the capital, in the case of participations in listed companies.

  • 20% of the voting rights or 25% of the capital, in other cases.

Other financial assets/securities

The sale of other financial assets and securities deposited in Italy may also give rise to a capital gain, subject to the 26% substitute tax in the hands of non-resident taxpayers. However, such gains are exempt if realised by residents of countries allowing adequate exchange of information. Furthermore, treaty exemptions may apply.

6. How is income received by a foreign national taxed? Is there a withholding tax? What are the income tax rates?

Individuals who are not tax resident in Italy are subject to tax on their Italian-source income only. Some items of income are subject to tax at progressive rates while other items of income (mostly financial income) are subject to a final withholding tax.

Progressive tax rates

The following sources of income are taxed at progressive rates (up to 43% and, until tax year 2016, a 3% surcharge applies to individuals earning more than EUR300,000):

  • Income from land and buildings. A non-resident individual holding real property situated in Italy is subject to income tax on:

    • the rental fees received (less a 5% forfeiture reduction if the property is rented out (in some cases, the individual can opt for a flat 21% substitute tax on the gross rental payments)); or

    • if the property is not rented out, cadastral income (that is, a presumptive amount based on the cadastral value of the property, for cadastral value see Question 11, Purchase and gift taxes). However, if the property is directly owned by the individual, the income tax is usually substituted by the payment of the wealth tax (see Question 11).

  • Employment income, if the work is performed in Italy.

  • Business income derived from activities carried out in Italy through a permanent establishment.

Final withholding tax

The following sources of income are generally subject to a final withholding tax when paid to non-resident individuals (subject to certain exceptions):

  • Dividends: 26%.

  • Interest income: 26% (many exceptions are provided for residents in white-listed states. Moreover, interest derived from bank deposits paid to non-residents is exempt).

  • Royalties: 30%.

  • Directors' fees and self-employment income: 30%.

Tax treaties may provide for exemptions or lower rates.


Inheritance tax and lifetime gifts

7. What is the basis of the inheritance tax or gift tax regime (or alternative regime if relevant)?

Inheritance and gift tax applies to transfers of assets and rights by way of succession or gift (Legislative Decree 31 October 1990, No. 346) (Inheritance and Gift Tax Act). Taxable inter vivos transfers include:

  • Formal donations.

  • Gratuitous transfers other than formal donations.

  • Liens on property for a specific purpose or for the benefit of donees/beneficiaries (vincoli di destinazione) (including, according to the tax authorities, transfers into a trust).

Inheritance and gift tax applies to:

  • All assets and rights (on a worldwide basis), if the deceased/donor was resident in Italy at the time of death or gift.

  • Assets and rights located in Italy, if the deceased was resident abroad at the time of death or gift.

The taxable base is equal to the value of the assets and rights transferred, after the deduction of burdens and charges which the heir or the donee may be subject to.

Special rules govern the determination of the value of some assets and rights.

Certain liabilities are deductible if proved by officially dated documents such as:

  • Debts of the deceased.

  • Funeral expenses.

  • Medical expenses.

8. What are the inheritance tax or gift tax rates (or alternative rates if relevant)?

Tax free allowance

The following allowances apply to:

  • Spouses and direct descendants/ancestors of deceased/donor. Transfers are free from inheritance tax and from gift tax up to EUR1 million (the allowance applies to each beneficiary and taking into account any previous gift made by the deceased/donor to the beneficiary).

  • Brothers and sisters of deceased/donor. Transfers are free from inheritance tax and from gift tax up to EUR100,000 (the allowance applies to each beneficiary and taking into account any previous gift made by the deceased/donor to the beneficiary).

If the transfer is made in favour of a person with severe disabilities, the tax applies on the value exceeding EUR1.5 million (the allowance applies to each beneficiary and taking into account any previous gift made by the deceased/donor to the beneficiary).

Tax rates

The following rates are applicable:

  • Spouses and direct descendants/ancestors. The rate is 4%.

  • Brothers and sisters of deceased. The rate is 6%.

  • Relatives up to the fourth degree or persons related by direct affinity/collateral affinity up to the third degree. The rate is 6%.

  • All other cases. The rate is 8%.


The following transfers are exempt from inheritance and gift tax:

  • Transfers in favour of the Italian State or related local government.

  • Transfers in favour of foundations or other associations that have the purpose of assistance, scientific research, education or other public benefit.

  • Transfers of bonds issued by the Italian State (only in case of transfers on death).

  • Transfers of controlling participations in favour of spouses or direct descendants (other conditions are required).

Techniques to reduce liability

Transfer of bare ownership. Inheritance and gift tax can be reduced by transferring bare ownership with retention of usufruct (that is, right to use and enjoy the property). Under this method the:

  • Taxable basis on transfer is reduced.

  • Future consolidation of bare ownership with usufruct on death of the usufruct holder does not represent a taxable event.

Life insurance. Life insurance policies can also be used to reduce the impact of inheritance and gift tax. This is because payments received by beneficiaries of life insurance policies on the death of the insured person are not subject to inheritance tax.


Inheritance tax paid in another jurisdiction in relation to property located in that jurisdiction is credited against the Italian inheritance tax due, up to the amount of the Italian inheritance tax attributable to the value of such property (see Question 13).

Italy has concluded treaties which prevent double taxation of inheritances and gift taxes (see Question 14).

9. Does the inheritance tax or gift tax regime apply to foreign owners of real estate and other assets?

Under the territoriality rules, inheritance and gift tax applies to assets and rights located in Italy if the deceased/donor was resident abroad at the time of death or gift (see Question 7).

Assets that are deemed to be located in Italy include:

  • Assets and rights enrolled with public registers (such as real estate located in Italy and trade marks registered in Italy).

  • Shares or other participations in companies or other entities that have Italy as its legal seat, place of administration or main object.

  • Bonds and other securities issued by the Italian State or by companies that have Italy as its legal seat, place of administration or main object.

  • Debts if the debtor is resident in Italy.

  • Debts guaranteed by assets located in Italy, irrespective of the residence of the debtor.

10. Are there any other taxes on death or on lifetime gifts?

Transfers of immovable assets (and other proprietary-like rights, such as usufruct) located in Italy are subject to mortgage and cadastral taxes at an aggregated rate that is generally 3%.


Taxes on buying real estate and other assets

11. Are there any other taxes that a foreign national must consider when buying real estate and other assets in your jurisdiction?

Purchase and gift taxes

The acquisition of real estate property in Italy is subject to transfer taxes (that is, a combination of either VAT or registration tax, and mortgage (even if no mortgage is undertaken) and cadastral taxes).

If real estate property is acquired by an individual, transfer taxes apply differently depending on the nature of the transferor. If the transferor is an:

  • Individual not carrying on a business or professional activity. Registration tax is due at a proportional rate of 9% on the cadastral value (that is, a rated value of the property provided by the tax authorities of the property) plus a fixed EUR100 tax. A reduced rate of 2% plus a fixed EUR100 tax is applicable if the immovable property qualifies for the primary abode regime.

  • Individual or company carrying on a business or professional activity. If the immovable property has a residential nature and the transferor is not the builder of the transferred property, registration tax is due at a proportional rate of 9% on the cadastral value of the property (as above) plus a fixed EUR100 tax. However, if the transferor is the builder and the purchase is made within fiveyears from the date of completion of the building or renovations:

    • the transaction is subject to VAT. The rate may vary according to several elements from 10% to 22% of the purchase price of the real estate property; and

    • a fixed amount of EUR400 in transfer taxes is due.

If the purchase is made after five years from the date of completion of the building or renovations, registration tax of 9% on the cadastral value plus a fixed EUR100 tax is due. However, the seller can choose to charge VAT. Then, the VAT rate can vary (depending on several factors) from 10% to 22% of the purchase price of the real estate property and a fixed amount of EUR400 in transfer taxes is due.

Specific provisions apply if the real estate property is acquired via a corporate structure or trust. For taxation of recurring income and capital gains, see Questions 5 and 6. For taxation in the case of gifts or mortis causa transfers, see Questions 7 and 8.

Wealth taxes

Italy does not levy a catch-all wealth tax. Different taxes on specific assets held by Italian resident individuals are applied (see Question 13). The most important are those regarding financial assets held in Italy, financial assets held abroad, real estate located abroad and Italian real estate.

A non-resident individual is subject to the tax on financial assets held in Italy (this tax applies also to resident individuals). Article 19(1), Law Decree of 6 December 2011, No. 201 introduced starting from 2012, a proportional tax that applies to financial products or instruments (including, unit-linked insurance policies). This tax applies at the rate of 0.2% on the market value of the securities or, in the absence of this, the nominal value or on the redemption amount of the financial instrument. Specific provisions are applicable on deposits and current accounts.


A non-resident individual is also subject to the municipal real estate tax (imposta municipale unica) (IMU) concerning immovable property located in Italy (this tax applies also to resident individuals). IMU applies at different rates, depending on the local municipality in case of ownership or other rights in rem on Italian real estate assets. The tax base is equal to the cadastral rent increased by 5% and multiplied by a factor ranging from 160 (for residential properties) to 55 (for most types of commercial properties). Specific provisions are applicable if the real estate is regarded as primary abode.

12. What tax-advantageous real estate holding structures are available in your jurisdiction for non-resident individuals?

Real estate taxation varies considerably depending on the holding structure which is used (for example, whether the real estate is held by direct ownership, a resident or non-resident company, through a foreign trust and so on).

Whether a holding structure is tax advantageous depends on the circumstances of the specific case. Such factors include, for example:

  • The residence of the parties involved.

  • Whether the real estate is used for residential or commercial purposes.

  • The presence of interest on a loan.


Taxes on overseas real estate and other assets

13. How are residents in your jurisdiction with real estate or other assets overseas taxed?

Resident individuals are taxed on their worldwide income if this falls within one of the categories of taxable income provided in the Italian Tax Code.

Immovable property located in another jurisdiction only yields taxable income in Italy if the property:

  • Is rented out.

  • Accrues deemed rental income, according to the tax provisions of the jurisdiction in which the asset is located, if the property is kept available to the Italian resident owner.

Taxable income is determined by the amount of rental income that the property accrues in the foreign country. If the foreign jurisdiction does not tax the rental income, for the purposes of Italian taxation, the taxable income is the same as any income which derives from leasing the property in the foreign jurisdiction (with a reduction of 15% as a forfeit for costs).

A tax credit is available for taxes paid abroad, up to the amount of the corresponding Italian tax paid on the taxable income (see Question 14).

A disposal of immovable property (wherever situated) for consideration is only subject to tax on capital gains if the disposal is made less than five years from when the asset is acquired (see Question 5). In any event, the capital gains from property acquired by inheritance are not taxable.

Italy levies different taxes on specific assets held abroad by Italian resident individuals:

Tax on real estate property located abroad. Starting from 2012, real estate held abroad by Italian resident individuals is subject to a tax of 0.76% (Imposta sul valore degli immobili situati all’estero) (IVIE). The taxable value differs for the following:

  • Purchased real estate: the purchase cost, as noted in the purchase contract, or, in the absence of this, the fair market value of the property.

  • Real estate acquired by way of inheritance or gift: the value subject to inheritance tax or the value resulting from the registered deed of gift or, lacking such values, the purchase cost for the deceased/donor or, lacking the documentation of the purchase cost for the deceased/donor, the fair market value of the property.

  • Real estate located in EU states or EEA states providing adequate exchange of information (irrespective of whether the real estate was purchased or received by way of inheritance or gift): the cadastral value in the foreign state if relevant for wealth or income foreign taxes or, lacking such a cadastral value, the purchase cost, as noted in the purchase contract, or, in the absence of this, the fair market value of the property.

Taxpayers will be granted a tax credit for the wealth tax paid in the country where the property is located, if any (Circular letter No. 28/E of 2012 provides for guidance on which foreign wealth taxes may reduce the Italian tax).

Tax on financial assets held abroad. Article 19(18), Law Decree of 6 December 2011, No. 201 has introduced starting from 2012, a tax that applies on financial assets held abroad by Italian resident individuals (tax on the value of the financial assets held abroad) (Imposta sul valore delle attività finanziarie detenute all’estero) (IVAFE). IVAFE applies at the rate of 0.2% on the market value of the financial instruments or, in the absence of this, on the nominal value or on the redemption amount. Specific provisions are applicable on deposits and current accounts. Foreign financial assets which are deposited with an Italian financial intermediary are to be regarded as assets held under deposit in Italy, and not held abroad for the purpose of the application of the tax on foreign financial assets (see Question 11).

Reporting duties. Resident individuals have reporting obligations in relation to foreign-held assets. This includes assets owned by trusts, foundations or other entities that are beneficially owned by the resident individuals. Failing to comply with these obligations can result in very severe penalties.


International tax treaties

14. Is your jurisdiction a party to many double tax treaties with other jurisdictions?

Italy has concluded the following tax treaties:

  • More than 90 income tax treaties.

  • Seven inheritance tax treaties (one of which covers gift tax).

The general method for avoiding double taxation is the credit method. Under this method, a tax credit is provided under domestic legislation which corresponds to the amount of tax already paid in respect of other jurisdictions. To obtain such relief, the Italian resident must show to the Italian tax authorities that the taxes to be covered by the credit have been definitively paid in the other jurisdiction(s).


Wills and estate administration

Governing law and formalities

15. Is it essential for an owner of assets in your jurisdiction to make a will in your jurisdiction? Does the will have to be governed by the laws of your jurisdiction?

The Civil Code provides specific rules covering intestate successions (see Question 28). If an individual dies without making a valid will, and to the extent the succession is regulated by Italian law, these rules apply. Foreign wills may be valid (see Question 18).

16. What are the formalities for making a will in your jurisdiction? Do they vary depending on the nationality, residence and/or domicile of the testator?

Italian law provides for the following types of will:

  • Holograph will. This is a private deed. The formalities for a holograph will require it to be:

    • handwritten;

    • dated; and

    • signed personally by the testator.

    A holograph will can be drawn up at any time using any kind of sheet, without any cost. It can be kept by the testator, but it is more convenient for the testator to deliver the will to a public notary to avoid destruction before or after death.

  • Public will. The formalities for a public will require it to be:

    • delivered to a public notary in the presence of two witnesses; and

    • signed by the testator.

    The advantage of a public will is that the notary personally collects the will in the presence of witnesses and the will immediately provides compliance with Italian law in respecting the wishes of the testator.

  • Secret will. To be executed, a secret will must be delivered to a public notary in the presence of two witnesses. Other formalities are provided by Article 605 of the Italian Civil Code. This form of will is rarely used.

Italy entered into the Convention providing a Uniform Law on the Form of an International Will (Washington DC, 26 October 1973).


Redirecting entitlements

17. What rules apply if beneficiaries redirect their entitlements?

There is no procedure to vary a will. However, an heir can renounce his claims to the estate. In this case, the heir:

  • Has no liability for the deceased's debts.

  • Receives no benefit from the estate.

Acceptance can also be made with reservation, meaning that the heir is liable for the debts of the estate only up to the value of the inherited estate.


Validity of foreign wills and foreign grants of probate

18. To what extent are wills made in another jurisdiction recognised as valid/enforced in your jurisdiction? Does your jurisdiction recognise a foreign grant of probate (or its equivalent) or are further formalities required?

Regulation (EU) 650/2012 on jurisdiction, applicable law, recognition and enforcement of decisions and acceptance and enforcement of authentic instruments in matters of succession and on the creation of a European Certificate of Succession (Succession Regulation) follows the traditional principle of favor testament and provides that a will must comply with the formal requirements set out by one of the eight laws to be recognised. These laws are alternately referred to in Article 27 and include, for example, the law of the state:

  • Where the will was made.

  • Where the testator had his habitual residence at the time when the will is made.

  • Whose nationality the testator had at the time when the will is made.


Death of foreign nationals

19. Are there any relevant practical estate administration issues if foreign nationals die in your jurisdiction?

No practical issues arise from the mere fact that a foreign individual dies in Italy.


Administering the estate

20. Who is responsible for administering the estate and in whom does it initially vest?

Responsibility for administering

As a general rule, the power of administration reverts to the heir if he accepts the estate.

The court can appoint a hereditary administrator if the person entitled to inherit:

  • Has not yet accepted the status of heir.

  • Is not in possession of the estate property.

With the prior authority of the judge, the hereditary administrator can deal with payment of the estate's debts and the legacies.

The testator may also appoint in his will one or more executors responsible for ensuring that the wishes are followed through, whether in relation to the entire will or part of it.

Generally the executor has the power of administration over the property, within the limits set out in the terms of appointment. To that end, the executor takes possession of the property and carries out all necessary management. On termination of their duties, the executors must submit a report to the heirs.


The estate vests in the heirs on acceptance of the estate with a retroactive effect as from the date of death of the deceased.

21. What is the procedure on death in your jurisdiction for tax and other purposes in relation to:
  • Establishing title and gathering in assets (including any particular considerations for non-resident executors)?

  • Paying taxes?

  • Distributing?

Establishing title and gathering in assets

The heirs must file a declaration with the competent Registry Office within 12 months of either the date of death or date of presumed death. The declaration must:

  • Be completed and signed on official forms provided for such purpose.

  • Contain both:

    • information about the heirs and the degree of relationship; and

    • a detailed description of the assets and liabilities.

Procedure for paying taxes

On the basis of the declaration, the competent office computes and assesses the amount of inheritance tax due.

Under specific legal provisions provided for by the Succession Tax Code, debtors (such as banks) can be prevented from releasing the assets to the heirs if they are not satisfied that a declaration of succession has duly been filed.

22. Are there any time limits/restrictions/valuation issues that are particularly relevant to an estate with an element in another jurisdiction?

The same rules apply whether the estate is purely domestic or has foreign elements.

23. Is it possible for a beneficiary to challenge a will/the executors/the administrators?

A will can be challenged on the following grounds:

  • Incapacity of the testator.

  • Forgery.

  • Nullity (for example, where a notary has signed the will without witnesses or where a holographic will has been typed instead of handwritten).

  • Violation of forced heirship rights.

In addition, the judge, subject to the request of the heirs, can dismiss the executor.


Succession regimes

24. What is the succession regime in your jurisdiction (for example, is there a forced heirship regime)?

Italian succession law regulates:

  • Testate successions, regulated by a valid will. Italian law provides for forced heirship rules (see Question 25).

  • Intestate succession, lacking a will.

Succession agreements are generally not allowed under Italian law with only one exception. Under a family pact, a business or a qualifying interest in a trading company can be transferred to descendants under an agreement between all living forced heirs. The forced heirs that do not receive their share of the business or of the qualifying participation can instead be granted a cash amount or other assets by the transferees, or they can renounce (entirely or in part) their reserved share. Family pacts have not been widely used.


Forced heirship regimes

25. What are the main characteristics of the forced heirship regime, if any, in your jurisdiction?

Main characteristics

Under forced heirship rules, a person cannot freely dispose of all his assets by will or gift, since a quota of the estate must be transferred to forced heirs (including the spouse, the legitimate, natural and adopted children, and, under certain conditions, the ascendants).

The reserved quota of the estate (that is, the quota of the estate that must be transferred to the forced heirs) varies according to the number and nature of the heirs.

If, for example, the forced heirs are the spouse and two or more children, 50% of the entire estate of the deceased is reserved to the descendants (to be equally divided among them) and one fourth of such estate is reserved to the spouse.

For the purpose of calculating the reserved quota, the items to be considered for the purposes of determining the estate of the deceased will be equal to both:

  • All the assets owned by the deceased at the time of his death (net of any debts).

  • All the assets which have been gifted by the deceased during his life.

The contribution of assets into a trust is to be considered as a gift and therefore it will be included in the calculation of the estate for the purpose of computing the reserved portion.

If the reserved quota is not respected, the forced heirs can use a specific legal action called a claw-back action (azione di riduzione) which enables them to restore the reserved quota.

If the assets are added to a foreign trust which infringes forced heirship rules, the trust is not considered void. However, the claw-back action is available to the aggrieved parties to restore the shares of the estate that cannot be disposed of.


Real estate or other assets owned by foreign nationals

26. Are real estate or other assets owned by a foreign national subject to your succession laws or the laws of the foreign national's original country?

The general rule is that the applicable law to the succession as a whole is the law of the state of habitual residence of the deceased at the time of death (see Article 21(1),of the Succession Regulation). In limited circumstances, it can be the law of the state that the deceased was manifestly more closely connected with at the time of death (see Article 21(2) of the Succession Regulation).

If the state of habitual residence is a third state (that is, not an EU/EEA member state), its conflicts of law rules could apply. Under Article 34(1) of the Succession Regulation, the application of the law of any third state includes its rules of law that are in force and its rules of private international law if those rules make a renvoi either to the law of:

  • A member state.

  • Another third state which would apply its own law.

Therefore, if the conflicts of law rules of the third state make a renvoi, for example, to the law of a member state, the succession law of this member state will apply.

Finally, under Article 22(1), an individual can choose, as the law to govern his/her succession as a whole, the law of the state whose nationality he/she possesses either upon the exercise of the option or upon death and that, in case of multiple nationalities, the individual can choose the law of any of the states whose nationality he possesses (either at the time of making the choice or at the time of death). If such option is exercised, the conflict of law rules provided by the chosen law will not apply (see Article 34(2) of the Succession Regulation). 

27. Do your courts apply the doctrine of renvoi in relation to succession to immovable property?


28. What different succession rules, if any, apply to the intestate?

Inheritance may devolve to the spouse, descendants, ascendants, other relatives and, in their absence, to the Italian state if:

  • There is no will.

  • The will is invalid.

The Civil Code provides detailed rules for the various situations that may occur. For instance, under an intestate succession, the estate is transferred as follows:

  • If the heirs are the spouse and only one (legitimate/natural/adopted) child, half of the estate is inherited each.

  • If the heirs are the spouse and more than one child, the children inherit two thirds and the spouse one third.

  • If the spouse survives but there are no children, the spouse succeeds the deceased together with the ascendants and siblings.

  • Lacking a spouse and children, the ascendants and siblings inherit the estate.

29. Is it possible for beneficiaries to challenge the adequacy of their provision under the intestacy rules?

It is not possible for beneficiaries to challenge the adequacy of their provision under the intestacy rules.



30. Are trusts (or an alternative structure) recognised in your jurisdiction?

The Italian Civil Code does not provide for the trust institution. However, trusts regulated by foreign law may be recognised in Italy under the 1985 Hague Convention on the Law Applicable to Trusts and on their Recognition (Hague Trusts Convention) (see Question 31).

Specific rules on the taxation of trusts have been introduced in Italy by Law 27 December 2006, No. 296. Among the others, these rules have clarified that a trust may be a taxable person for corporate income tax purposes.

Type of trust and taxation

For Italian tax purposes, trusts can be categorised as:

  • Opaque trusts. Irrevocable and discretionary trusts can qualify as opaque trusts. The trust income is taxed at trust level according to Italian tax rules applicable to commercial or non-commercial bodies (as the case may be).

    Trusts which are resident in Italy for tax purposes are taxed on their worldwide income, while non-resident trusts (assuming they do not carry on a commercial activity in Italy) are subject to Italian taxation on Italian-source income only.

  • Transparent trusts. These are fixed-interest trusts or other trusts where the beneficiaries have a current entitlement to the trust income. The income is determined at trust level, but taxed at beneficiary level at progressive rates. The tax authorities have recently stated that income from non-Italian resident transparent trusts attributable to Italian resident beneficiaries must be taxed in Italy at beneficiary level.

  • Interposed trusts. These trusts are disregarded for tax purposes and the underlying assets are considered to belong directly to either the:

    • settlor (for example, in case of revocable trusts); or

    • beneficiaries (for example, when the deed assigns these persons extensive powers or rights).

    If a trust is considered to be interposed, income generated by the trust assets is taxed directly in the hands of either the settlor or the beneficiaries (depending on the circumstances). Determination of whether a trust is interposed is based on:

    • documents and factual background. This includes, for example, the degree of actual control held by the settlor/beneficiary over the trust assets, even if a trust is formally discretionary and irrevocable;

    • a case-specific analysis.

    Under the guidelines of tax authorities (for example, Circular No. 48 of 2007), revocable trusts are disregarded for income tax purposes so that the income from the trust assets is imputed directly to the settlor (in contrast with provincial tax court of Brescia, judgment No. 339 of 17 April 2014). Tax authorities have also provided a non-exhaustive list of cases as examples of interposed trusts, including trusts that can be terminated by the settlor and trusts where the settlor has the power to change the beneficiaries. The power of the settlor to remove and appoint the trustees may lead to the trust being disregarded by the tax authorities (such approach was rejected by the provincial tax court of Novara, judgment No. 73/06/13 of 21 May 2013 and by the provincial tax court of Varese, Chamber 3, judgment No. 305 of 28 May 2015).

Residence of trusts

Since trusts are now subject to corporate taxation, the tax residence of a trust can be ascertained from the rules which govern the residence status of companies and other entities. Therefore, a foreign trust is generally regarded as resident in Italy for tax purposes if it has any of the following in Italy for the major part of the tax year:

  • Its legal seat.

  • Its place of management.

  • Its main object.

Tax authorities took the view that, if a trust holds only real estate that is located mainly in Italy, then its main object is located in Italy, and, therefore, the trust is resident in Italy.

In addition, Italian legislation has a presumptive rule under which trusts established in jurisdictions not exchanging information are deemed to be resident in Italy for tax purposes when either:

  • They are set up by an Italian-resident settlor for at least one Italian-resident beneficiary.

  • An Italian-resident person adds Italian real estate assets to the trust fund.

The presumption can be rebutted if it can be proved that the trust is effectively non-resident in Italy.

31. Does your jurisdiction recognise trusts that are governed by another jurisdiction's laws and are created for foreign persons?

Italy entered into the Hague Trusts Convention through the enactment of Law 16 October 1989, No. 364. As a result, trusts regulated by a foreign law, including trusts created for foreign persons, may be recognised in Italy pursuant to the provisions of this Convention.

32. What are the tax consequences of trustees (for example, of an English trust) becoming resident in/leaving your jurisdiction?

A trustee's change of residence can affect the tax residence of a trust (see Question 30, Residence of trusts). Since trusts are now subject to corporate taxation, the tax residence of a trust can be ascertained from the rules which govern the residence status of companies and other entities. However, when considering whether a trust has its seat of administration in Italy (see Question 30, Residence of trusts), the tax authorities have indicated that the trust's place of administration must coincide with "the place of the fiscal domicile of the trustee". Therefore, the default residence of a trust will be presumed by the tax authorities to be in the trustee's country of residence.

Under these rules, a foreign trustee taking up residence in Italy or an Italian trustee leaving the Italian jurisdiction may result in a change of tax status of the trust for Italian tax purposes (depending on the circumstances).

33. If your jurisdiction has its own trust law:
  • Does the law provide specifically for the creation of non-charitable purpose trusts?

  • Does the law restrict the perpetuity period within which gifts in trusts must vest, or the period during which income may be accumulated?

  • Can the trust document restrict the beneficiaries' rights to information about the trust?

Since Italian law does not provide for the trust institution, this is not applicable (although foreign trusts are recognised under the Hague Trusts Convention).

34. Does the law in your jurisdiction recognise claims against trust assets by the spouse/civil partner of a settlor or beneficiary on the dissolution of the marriage/partnership?

Although, in certain circumstances, foreign trusts may be recognised in Italy under the Hague Trusts Convention (see Question 35) the existence of a trust may not be effective to segregate the assets belonging to the trust fund and therefore may not prevent successful claims by, for example, former spouses.

35. To what extent does the law of your jurisdiction allow trusts to be used to shelter assets from the creditors of a settlor or beneficiary?

Generally, a trust is not invalid if the trust is genuinely discretionary and control of the trust assets is lost by the settlor/beneficiaries. However, typically, Italian courts have rejected the existence of a trust if satisfied by proper evidence that the trust was created with the sole aim of sheltering assets from creditors. Specific case law on this issue has tended to reflect this direction. For example, in a recent case, the criminal chamber of the Italian Supreme Court allowed a seizure of assets held in trust, and found (decision 30 March 2011, No. 13276):

  • That the settlor was still considered the owner of the assets.

  • The trust to be a sham transaction.

The impact of Italian bankruptcy law must also be considered. Under these rules:

  • Gratuitous transfers made during the two years before a declaration of bankruptcy are void.

  • Creditors are granted a general claw back action (azione revocatoria) for transactions which jeopardise their rights as creditors within five years from the date of the transaction.

The rights of forced heirs cannot be affected through the settlement of a trust (see Question 25).



36. Are charities recognised in your jurisdiction?

Charities may operate in Italy. These are typically in the form of either a charitable trust or not-for-profit entity (for example, a legally recognised foundation or association with a statutory purpose or objective for the pursuit of a publically beneficial activity). Charitable foundations set up under Italian law are not-for-profit organisations and any profits must be reinvested for the pursuit of its public aims/objectives.

37. If charities are recognised in your jurisdiction, how can an individual donor set up a charity?

Charitable trusts, foundations and associations with public purpose are set up by way of public formal deed or testamentary act. See Question 36.

38. What are the benefits for individuals when setting up charitable organisations?

The Inheritance and Gift Tax Act allows certain gifts and/or property bequeathed via a will to be exempt from inheritance and gift tax if the property is destined for public benefit. Under the Inheritance and Gift Tax Act, “public benefit” may be deemed to include assistance, study, scientific research, education, instruction or any other purpose of public benefit. However, since its application is linked to the nature and features of the receiving body or entity (for example, a public body or a legally recognised foundation or association), the exemption is construed as subjective.

The exemption from inheritance and gift tax can also apply to foreign public bodies and foundations/associations established abroad, provided the State where the foreign beneficiary entity is established allows a comparable exemption under the same circumstances (reciprocity requirement).

However, this can raise a series of interpretative issues, such as in relation to ascertaining:

  • Whether the element of the legal personality is required for both the Italian entity and the foreign entity.

  • Whether it is necessary for the foreign body to be established with the same legal form of association or foundation (within the meaning and the characteristics that they have under the Italian legal system).

For example, it could be disputed as to whether the legal form of trusts can be eligible for the exemption from inheritance and gift tax. In such a case, the exemption should apply to any type of foreign body which may be considered (irrespective of their legal form) as sharing the main features with Italian not-for-profit entities limited to the pursuit publicly beneficial activities.


Ownership and familial relationships


39. What are the laws regarding co-ownership and how do they impact on taxes, succession and estate administration?

Italian law recognises co-ownership of assets. Co-ownership can derive from either:

  • Law (for example, spouses under a communion of assets regime or heirs of an undivided estate).

  • Free choice of the parties.

If co-ownership occurs:

  • Each party is considered the owner of his undivided share of the assets.

  • Tax and succession law applies accordingly (and therefore every co-owner is only liable for tax on his own share).

In relation to successions of assets that are owned by two or more co-owners, ownership of the estate is made up of the undivided share of each co-owner.

Italian succession law does not provide for the right of survivorship (other than in case of the co-owners of usufruct right only and provided that such right of survivorship is expressly provided for on the creation of the usufruct right).


Familial relationships

40. What matrimonial regimes in trust or succession law exist in your jurisdiction? Are the rights of cohabitees/civil partners in real estate or other assets protected by law?

Community regime

The Italian co-ownership regime is the regime normally applicable to all property acquired during marriage. It is the default regime, unless the spouses have elected for the separation of assets regime. Under a co-ownership regime the assets are held in communion by the spouses, so that each of them as a undivided share of the whole. Under a separation of assets regime, each spouse possesses its own assets.

Assets which fall within the co-ownership regime can only be disposed of with the consent of both spouses. Failing this, the contract may be declared void on application of the non-consenting spouse.

The co-ownership regime includes all assets (and related income) received or purchased during the marriage (separately or together) with a few significant exceptions, which include:

  • Inheritance and gifts to only one of the spouses.

  • Goods dedicated to personal use.

Family fund

A family fund is used to allocate assets to meet family needs and can be created by either both spouses or a third party before or during marriage, by either:

  • Inter vivos formal deed.

  • Testamentary act.

A family fund is defined in relation to the use of the assets rather than the ownership of them. In the absence of other dispositions, ownership is vested in both spouses and can only be disposed of with either:

  • The consent of both spouses.

  • Authorisation from the court (if there are minor children).

Civil partnerships are not recognised in Italy. In principle, cohabiters are also given no protection, though recent case law has developed whether certain rights exist for cohabiters more uxorio (that is, live together as a married couple).

41. Is there a form of recognised relationship for same-sex couples and how are they treated for tax and succession purposes?

In 2016, same sex civil unions were introduced under Italian civil law. Same sex marriages or civil unions executed abroad have been assimilated to Italian same sex civil union. This introduction has the effect of making them subject to the same succession law regime (such as forced heirship), patrimonial regime and tax regime (such as rates and exempt amount) that are applicable to marriages.

42. How are the following terms defined in law:
  • Married?

  • Divorced?

  • Adopted?

  • Legitimate?

  • Civil partnership?


Marriage is the legal union of one man and one woman as husband and wife.


Divorce is the dissolution of a marriage by decree. A marriage is dissolved on the day the decree obtains legal force.


Adoption is the legal process under which a child's legal rights and duties toward his natural parents are terminated and similar rights and duties towards his adoptive parents are substituted.


A child is legitimate if he was born to married parents. There is a procedure for legitimising the status of an illegitimate child.

Civil partnership

In 2016, same sex civil unions were introduced under Italian civil law. Same sex marriages or civil unions executed abroad have been assimilated to Italian same sex civil union. This introduction has the effect of making them subject to the same succession law regime (such as forced heirship), patrimonial regime and tax regime (such as rates and exempt amount) that are applicable to marriages.



43. What rules apply during the period when an heir is a minor? Can a minor own assets and who can deal with those assets on the minor's behalf?

A minor can own assets. Legal administration is attributed to either:

  • Parents.

  • A legal guardian (in certain circumstances).

Certain acts require the authorisation of the minor tribunal (child court).

Minors can only accept the inheritance with reservation (that is, subject to limitation of liability for debts of the estate up to the amount of the net assets actually received).


Capacity and power of attorney

44. What procedures apply when a person loses capacity? Does your jurisdiction recognise powers of attorney (or their equivalent) made under the law of other jurisdictions?

When a person loses capacity, his protection is organised by law and, depending on the degree of incapacity, different regimes apply. For example, if the person is of totally unsound mind, he must be represented by another person. In other cases, he will only be advised or controlled.

Italy recognises the capacity status of persons governed by the laws of other jurisdictions. Therefore, Italy would accept a power of attorney which is valid under the laws of other jurisdictions (if the deceased is resident in such jurisdiction).

The recently adopted Law 22 June 2016, No. 112 sets out a favourable tax regime for trusts for the benefit of disabled individuals. Subject to certain conditions, such trusts can benefit, among other things, from a full exemption from inheritance and gift tax.


Proposals for reform

45. Are there any proposals to reform private client law in your jurisdiction?

Currently, reforms regarding the increase in tax rates and the reduction of no-taxation thresholds for heirs and donees are under discussion.

In November 2016, the Italian government proposed the introduction of a new regime for individuals acquiring Italian residence, which is currently being discussed in Parliament. Under the draft legislation, if an individual has been a non-resident of Italy for at least nine of the previous ten tax years, he/she can opt to pay an annual fixed charge of EUR100,000 as a substitute tax on his foreign income and gains (except for capital gains on substantial shareholdings realised in the first five years which are taxed under the ordinary rules) instead of the application of the ordinary personal income tax regime. To benefit from this regime, the individual must file an advance ruling with the tax authorities. The option is effective for up to 15 years. It can be revoked but then the option will not be available for future tax years. Other relevant advantages of the regime are that wealth taxes,inheritance and gift tax on foreign assets do not apply. There is also an exemption from the duty to report foreign assets in the tax return.


Online resources

Ministry of Finance (Dipartimento delle Finanze)


Description. Website of the Italian Minister of Finance. It includes up-to-date official legislation, case law and administrative Ruling and Circulars (in Italian), as well as the text of the Italian income tax treaties.

Contributor profile

Guglielmo Maisto, Founding Partner

Maisto e Associati

T +39 02 7769 31
F +39 02 7769 33 00

Areas of practice. Domestic and international tax law; tax for M&A and corporate restructuring; corporate and group taxation; taxation of financial transactions; VAT; transfer pricing; estate planning and trusts; tax planning for high net worth individuals; tax litigation.

Professional associations/memberships

  • Professor of international and comparative tax law at the Università Cattolica di Piacenza.

  • President of the Italian Branch of the International Fiscal Association (IFA).

  • Member of the Board of Trustees of the International Bureau of Fiscal Documentation (IBFD) in Amsterdam.

  • Member of the Advisory Board of the Master of Advanced Studies in International Taxation of the Lausanne University.

  • Member of the Practice Council of New York University (NYU) Law's International Tax Program.

  • Member of the Board of the American Chamber of Commerce in Italy.

  • Represents the Italian Association of Industries (Confindustria) at the OECD Business Industry Advisory Committee in Paris.

  • Acted as a consultant to the Ministry for European Community Affairs and was a member of the EU Joint Transfer Pricing Forum.

  • Member of several law societies and of the editorial board of various Italian and foreign tax legal journals, and usually participates as a speaker at several annual tax conferences.

Languages. Italian, English, French

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