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05/29/2011 - 03:37

A short query regarding Residency. I have owned a house here for 15 years which is my only property as I rented back in the UK. Three years ago I got residency here as I was offered a job by an English travel Company.....which then fell through, so I have been living off of savings. Now due to the Financial situation/credit crunch etc, I need some work which I cannot get here. I am doing a part-time job for the Company but back in the UK, and so travel back and forth, the Company will not pay me into an Italian bank A/c so I use my UK bank, as I don't really want to get into the Italian Income Tax system should I deregister here as a Resident. Messy I know!


If I were you I would consult a 'Comercialista' or good Accountant rather rely on the advice of well meaning, but maybe inaccurate information from forum members, as it is up to you to make the choice. You need to get qualified advice from someone who will know your exact financial position and also your commitments under Italian Law. It may cost you a couple of hundred Euros, but better that than be landed with a large bill from the Government.

I would find out where you would pay the least tax & pay the tax there. You shouldn't be taxed twice. Professional advice would be a good idea so you can calculate which is your best option. I have residency in England & Italy, no-one seems to noticewink In bocca al lupo

In reply to by atessa

Hi Atesa,

"How did you get around the personal income tax issue when you applied.

I didn't /don't have a "personal income tax issue" that I am aware of. If I earned any income in taly I would pay tax on it there, but I don't so I don't.  I found that all the issues & obstacles that I encountered were "evitabile" by getting to know people and asking politely & repeatedly for guidance. After a while I met helpful people & doors opened & things were signed. This took dozens of visits to the various commune & ASL offices etc. In bocca al lupo wink

Thanks for that Chrisnotton,just tried what you suggest with my geometra,now no health insurance required.Will try slowly and hope the doors open for me.Slowly,slowly,your approach seems to work,Atessa

In reply to by atessa

Thanks for that Chrisnotton, just tried what you suggest with my geometra,now no health insurance required.Will try slowly and hope the doors open for me.Slowly,slowly,your approach seems to work,Atessa

It seems to be the way things work in the smaller communities, so much is discretionary there that a helpful official or introduction makes all the difference. I have only experience in a small commune but I suspect, in larger places, the proceedure becomes a bit more adversarial & you will only become sucessful when you have dotted all the i's & crossed all the t's. I don't know how people are getting on in Ascoli Piceno now but there were real problems there with their interpretation of the rules! I have found "Goccia a goccia scava la pietra" (drop by drop wears away the stone)

If you are resident in Italy you should pay tax in Italy. Then because of the double tax agreement you can deduct any tax already paid in UK. So yes, you are theoretically taxed twice, by each country in turn.  I'm led to believe tax in Italy is higher so there would be extra to pay. (But if tax in UK is higher I doubt they would give you any back if you were officially tax-resident in Italy sad). HMRC complicate matters by deeming you tax-resident in UK if you spend more than 90 days there, regardless of your actual residency under the 6 month rule. But I doubt you could persuade the Italian authorities to let you off your liabilities just because of that.

In reply to by SirTK

The thing is about taxes in the UK is that you get a tax free allowance (based upon your tax code), which be something like the first £7,000 of your income not being taxed at all (tax free). My understanding that, in Italy, you would pay tax on ALL of your income, so the net effect of would be an extra £2,000 (or so) tax bill. In both cases you can offset an amount against legitimate expenditure, however, my understanding also is that ............... if you receive a UK (or other EU state) government pension whilst resident here in Italy, it is acceptable that this is taxed ONLY in the UK...... I'm sure someone can correct this if this is wrong !! S

I wonder also how they define pensioner. It may be that if you have reached the age that Italians can retire at, then it is okay. From what I can understand, if you have a UK government pension (ie public and not private or state pension) then there is no tax liability here in Italy.  Sure someone will correct me if I am wrong

As I understand it and I am no expert I use my comersialista for tax advice, tax is payable in Italy on your worldwide income, meaning that money earned overseas is also considered if the individual meets the test of a permanent resident in Italy. I can assume then that Chris is exempt from this?

"as I don't really want to get into the Italian Income Tax system should I deregister here as a Resident?" From the varied [and conflicting?] replies given here - it seems obvious to me that you should seek expert [Italian] advice to ensure [hopefully] that you 'stay legal' and achieve your aim on not paying Italian Tax Good Luck

Thanks everyone for all the contributions. It all seems to still be a bit of a grey area, as the so called EU Bureaucrat's have not really lined everyone up and each country still wants to do it's own thing. I'm being paid in the UK and paying NI etc, so am going to deregister here.

I've just been getting some professional advice regarding this matter. The main trigger to having to pay income tax in italy appears to be residency but if your work is not performed in Italy and you spend less than 183 days in Italy that may not be the case. I can thoroughly recommend Michael Murphy for all UK/Italian tax matters.

Thanks Penny and everyone, even though most of you went completely off the subject, which was about Residency and 'work' and not how many of you are 'Pensioners' which is a completely different 'Ball Game'

Try it again Flip, head against brick wall I think. Its not difficult, pay your tax, wherever it is due, qualify for health care if it is appropriate, there is no quick easy way to avoid what is rightly payable. If you thought the Inland revenue were scarey, you havent yet met the Italian finance police. Rant over.

In reply to by Penny

My pockets are big, but pretty empty. Someone in the EU needs to let 'them' know of this European Union palave that 'they' signed up to. They wave the EU flags well enough ! Well done for your efforts S