The Principle of Tax Residence under Italian Law
According to the provisions of Article 2 (2) of the Italian tax code, Testo Unico delle Imposte sui Redditi (TUIR), if you spend more than 183 days per fiscal year in Italy, you are considered resident in Italy for tax purposes.
If you meet one of the following conditions, you qualify as resident for Italian tax purposes:
- you are registered at your local town hall’s (comune) registry office;
- you have your domicile in Italy, i.e. your principal centre of business, economic and social interests, e.g. your family, as defined by the first paragraph of Art. 43 of the Civil Code;
- you have your residence in Italy, i.e. your habitual abode, as defined by the second paragraph of Art. 43 of the Civil Code.
The requirements indicated by TUIR are stand alone: for an individual to be considered as resident in Italy for tax purposes, the occurrence of one of the above conditions is sufficient.
If you move to Italy for more than 3 months, you must apply for registration at the comune where you intend to reside. Registration at your local comune evidences and confirms fiscal residence in Italy and therefore does not admit proof to the contrary (in other words, the maintenance of the registration of the resident population for most of the fiscal year in question produces an absolute presumption of Italian fiscal residence for the fiscal year in question). At the end of your stay in Italy, you are required to de-register from your comune.
However, if an individual qualifies as resident in two countries under their respective domestic laws, it will be necessary to have recourse to the application of Article 4 of the relevant Double Taxation Treaty (DDT) in order to resolve any conflict of dual residence for tax purposes and therefore to determine in which country the person is considered resident for tax purposes.
The onus is on the taxpayer to provide documentary evidence of fiscal residence outside of Italy by requesting a certificate of fiscal residence under the relevant DDT. It is also important to keep records such as travel documents which can help prove how long you were physically present in Italy in any given fiscal year.
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