🌍 Extension of the “Impatriate Regime” for workers who moved to Italy in 2020: what happens after the first 5 years
The so-called “impatriate regime” (Regime degli impatriati), ,aims to attract highly skilled workers to Italy by offering a significant tax incentive: partial tax exemption on employment, self-employment, and business income produced in Italy.
🔎 Standard duration: first 5 years
- Workers who transferred their tax residence to Italy in 2020 benefited from the regime for five years, starting from the year they became tax residents in Italy.
- For them, the last year of the initial benefit period was 2024.
📌 What happens after 2024?
As a rule, the regime expires after five years. However, Italian law allows an extension for an additional five years (up to a total of ten years), under specific conditions.
✅ Conditions for the 5-year extension
To continue benefiting from a tax reduction from 2025 to 2029, the worker must meet at least one of the following conditions before the end of 2024:
1️⃣ Have at least one minor or dependent child, including those in pre-adoptive foster care.
2️⃣ Purchase a residential property in Italy after the move (or within the 12 months before the transfer).
💰 Tax benefit during the extension
- During the first five years, eligible workers benefited from a 70% exemption on qualifying income (or even 90% for those working in southern Italy).
- During the extension period, the tax exemption is reduced to 50%.
- No lump-sum payment or additional contributions are required to access this extension (unlike the special rules for professional athletes).
📊 Summary table
| Period | Exemption | Conditions | Payment required? |
|---|---|---|---|
| First 5 years (2020–2024) | 70% (or 90% south) | Residence abroad for ≥ 2 years + move to Italy + work mainly in Italy | No |
| Additional 5 years (2025–2029) | 50% | At least one minor child or residential property purchase | No |
💼 Procedural requirements
- The worker must opt for the extension by indicating it in their 2025 Italian tax return (submitted in 2026).
- It is advisable to inform the employer to ensure correct application of reduced tax withholdings.
- Documentation proving the existence of the child or property ownership must be retained for potential tax audits.
📈 Example
Let’s assume:
- A worker moved to Italy in 2020.
- They have a minor child born in 2023.
- Their last year of standard benefit is 2024.
In this case, they qualify to extend the regime from 2025 to 2029 with a 50% tax exemption, without paying any extra fee.
⚖️ Conclusion
✔️ Workers who moved to Italy in 2020 will see their initial 5-year benefit end in 2024.
✔️ If they have a minor child or bought a home in Italy, they can extend the benefit for another 5 years (2025–2029) at a 50% exemption rate.
✔️ No lump-sum contributions or additional costs are required.
✔️ Timely option and proper documentation are crucial to continue enjoying the benefit safely.
💬 Need support?
If you or your clients are eligible for the extension, it is highly recommended to plan in advance, check compliance, and prepare the necessary documentation.
