Why Investing in a Global Super-Rich Residency in Italy is a Smart Tax Move
The Palazzo Raggi, an architectural marvel from the th century situated a short distance away from Rome’s Spanish Steps, once served as the residence of a notable noble family alongside numerous cardinals and historical figures hailing from the Italian aristocracy. Although the six-story edifice lay abandoned for several years, it is now in the process of being resurrected to host a fresh crop of residents: wealthy foreigners who have opted to depart from countries such as Switzerland, Dubai, or the Cayman Islands and relocate to Italy for the sake of experiencing la dolce vita and exploiting the alluring tax regime.
In , a little-known incentive was introduced for the super-rich of all nationalities. This initiative offers full exemption from paying tax on income generated overseas in exchange for an annual fee of €, (£,for residency in Italy. Additionally, family members may also benefit from this offering by paying a yearly fee of €, per person. The main objective of this endeavor was to boost high-end spending in the country, including luxury purchases and property investment. The program attracted individuals in its first year, which significantly increased to by the year . Today, the number of beneficiaries has exceeded , in the year .
revamped to include all modern amenities.”
The revitalization of the luxury home market has had a significant impact on the redevelopment of historical landmarks in urban areas, with buyers rarely settling for anything less than € million. Among these developments is the Palazzo Raggi, where out of the luxurious apartments have already been sold within a year of going on the market. Many of these purchases can be attributed to the benefits of the flat-tax system. According to Diletta Giorgolo, the head of residential property at Italy Sotheby’s International Realty, such swift sales are unprecedented in Rome. She attributes this demand to the desire for an th-century residence that has been renovated with contemporary amenities.
wealthy Chinese businessman; and a palace in Florence to an American family who fell in love with its Renaissance architecture.
Giorgolo has led a hectic life over the past few years. The surge of affluent individuals began in , mainly due to UK residents holding non-domicile status, exempt from paying overseas earned income or capital gains tax. This was influenced by Brexit, which triggered a mass exodus. Moreover, the COVID- pandemic caused many to reconsider their lifestyle choices, resulting in Giorgolo’s impressive sales record. He sold a property on Capri to a French couple who transformed it into a boutique hotel, a €m mansion in Venice to a wealthy Chinese businessman, and a palace in Florence to an American family drawn to its Renaissance architecture.
clientele of Italy’s real estate market.
Giorgolo reported the successful sale of a €m mansion in Laglio, a Lake Como town famous for being home to George Clooney. The buyers were a Swiss couple who have joined the ranks of other flat-tax clients, including a Dutch couple who purchased a Rome property for over €m and another who spent €m on a residence in Milan. Giorgolo noted that some opted for newly listed properties while others preferred fixer-uppers. Certain clients even chose to rent premium accommodations before committing to a purchase. These developments have undoubtedly benefited Italy’s high-end real estate industry.
the UK to Italy due to a combination of Brexit and concerns about potential tax changes under the Labour party. This influx of foreign nationals, many of whom were previously non-domiciled in the UK, has had a significant impact on the Italian estate market. Marco Cerrato, a respected tax lawyer and partner at Maisto e Associati in Milan, has overseen the financial affairs of numerous new billionaire residents to Italy. He attributes this trend to the growing perception that the UK is becoming increasingly inhospitable and fears that a potential election win for the Labour party could result in the elimination of key tax incentives.
In conclusion, the global trend towards flat-tax policies has proved to be a significant boon for Italy’s high-end real estate industry. The recent sales of properties in Rome, Milan, and Lake Como to wealthy international buyers underscores the demand for premium real estate in Italy. With many clients opting for newly listed properties or fixer-uppers, and some even choosing to rent before buying, Italy’s luxury market is experiencing a surge in interest. As the market continues to grow, we can expect to see more foreign investors flocking to Italy’s picturesque towns and cities for their own slice of la dolce vita.