An Evolving Regime
With the 2026 Budget Law, the Italian legislator has introduced further changes to the optional tax regime for foreign income provided under Article 24-bis of the Italian Income Tax Code (TUIR), adjusting the amounts of the substitute tax. Starting in 2026, the annual flat tax for ultra-high-net-worth individuals will increase to €300,000. Additionally, the substitute tax for the other family members participating in the regime will rise to €50,000. These changes demonstrate significant appeal and growing importance in cross-border tax planning.
Stability and Certainty for Long-Term Planning
Introduced in 2017, the new resident regime provides benefits exclusively to individuals who were non-residents in Italy for at least nine of the ten years preceding their relocation. If eligible, individuals can choose the alternative to the ordinary tax regime that offers lump-sum taxation on foreign-source income, regardless of the income amount. A key feature of the regime is that the economic conditions are ‘frozen’ for up to 15 years. This means that individuals who successfully elected this tax status in previous years retain the original conditions, regardless of any subsequent increases.
A Competitive Regime in Europe
Despite the increase, the Italian regime continues to position itself competitively compared to other European jurisdictions. Similar regimes were recently restricted or eliminated in several countries. Data from the Italian Court of Auditors confirm the measure’s success, reporting that between 2020 and 2023 the regime generated about €315 million in tax revenue, with the number of participants steadily increasing.
Regime: | Annual substitute tax (taxpayer) | Annual tax per family member |
Dal 2025 | 200.000 € | 25.000 € |
Dal 2026 | 300.000 € | 50.000 € |
More Informed Planning
The recent regulatory changes do not introduce additional obligations or investment requirements in Italy. The flat tax regime centralizes a proactive assessment for high-net-worth individuals and families. It invites international taxpayers to transfer their tax residence as part of a broader wealth strategy. While establishing Italian residency, taxpayers can work with their advisors to consider foreign income, asset management, and long-term objectives.
With the above context, the recent threshold increase represents an opportunity to optimize tax and wealth planning. Italy remains a premier jurisdiction with an effective and sustainable global strategy that attracts the high-net-worth class.
Cone Marshall’s Support
Cone Marshall supports new residents and prospective applicants in understanding and applying the new regime, delivering highly specialized expertise in international taxation.
Our services are all inclusive. We assist our clients with initial assessments, structuring assets and income flows, implementation, and ongoing support and compliance.
Through a tailored and fully integrated approach, Cone Marshall helps clients use regulatory developments as opportunities for effective planning.
Cryptocurrencies and Trusts: Classification and Planning Considerations
International wealth planning has evolved to consider cryptocurrency wealth structuring strategies. When properly structured, digital assets can also be included within trusts for asset protection, governance, and succession planning.
In many common law jurisdictions, cryptocurrencies are now recognized as assets that may be held by a trust, provided that adequate safeguards are in place regarding custody, traceability, and trustee powers.
Proper planning allows the management of tax, succession and compliance aspects, avoiding critical issues related to the asset’s volatility and legal classification.
Cone Marshall’s Support
Cone Marshall assists clients in structuring trusts suitable for holding digital assets, coordinating legal, tax and operational aspects. Our experienced team of international experts can assist with determining suitable jurisdictions and integrating digital assets into a holistic strategy that is aligned with the client’s long-term objectives.