Taxation of international executives
A person’s liability to Italian tax is determined by their residence status for taxation purposes and the source of income derived by them.
The general rule is that a person who is a resident of Italy is assessable on worldwide income unless they are exempt under the provisions of a double taxation treaty. A person who is a non-resident is only assessable on income derived directly or indirectly from sources in Italy.
The 2020 tax rates for residents and non-residents range from 23 percent to 43 percent plus an additional regional tax of between 0.9 percent and 1.7 percent. Furthermore, an additional municipal tax could be due; the tax rates range from 0 to 0.9 percent depending on the municipality.
The official currency of Italy is the European Euro (EUR).
Herein, the host country/jurisdiction refers to the country/jurisdiction to which the employee is assigned. The home country/jurisdiction refers to the country/jurisdiction where the assignee lives when they are not on assignment.
All information contained in this document is summarized by Studio Associato, the Italian member firm of the KPMG global organization of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. The information contained in this publication is based on the Italian Unified Income Tax Code DPR 22 December 1986 n.917; D.Lgs. 15 December 1997 for the Regional Taxes, n. 446, D.Lgs. 28 September 1998, n. 360 and Law 27 December 2006 n. 296 for Municipal Taxes, Circular Letter 23 December 1997 n. 326/E for the types of Employment Income; D.Lgs. 21 November 1997, n.461 for Taxation of Capital Gains with update of D.M. 2 April 2008, n.2; DPR 7 December 2001, n.435 and DPR 22 July 1998, n.322 for Tax compliance rules; D.Lgs. 18 December 1997 n.471 and n.472 for the Administrative Sanctions, and Legislative decree No. 286. published on 1998, “testo-unico immigrazione” 2 Law No. 68, published on 2007.
© 2021 KPMG S.p.A., KPMG Advisory S.p.A., KPMG Fides Servizi di Amministrazione S.p.A. and KPMG Audit S.p.A., Italian limited liability share capital companies, KPMG Business Services S.r.l., Italian limited liability company, and Studio Associato - Consulenza legale e tributaria, Italian professional partnership, are member firms of the KPMG global organization of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.
For more detail about the structure of the KPMG global organization please visit https://home.kpmg/governance.