highlander1

Having read the links on your postings, what would be the position re tax free Isa's , no tax in UK , but 26% on interest to be levied by Italy ? Plus bollo ?

modicasa

A guess : but as an ISA is a savings account it would be subject to bollo if not interest too.

JACHA

Donna - You have my sympathy. Trying to work out the tax issues before we commit to moving to Italy for only 12 months has been a nightmare for us. We are Australian but the tax issues apply for all non eu citizens. We would be considered residents after 183 days, and the ties we have here in Australia seem irreleavant.
The proffesional advice has helped a lot. However the bottom line is that we will have to pay 0.76% on our worldwide assests. For our house we have to provide when applying for the visa and Permesso the cost of the house when we purcheased it 20 years ago and the current market value, as all foreigners who have real estate out side of italy have to pay this. Then the Italian Governemnt will decide on assesing on market value or what we paid. Lets hope it would be on what we paid. Also tax returns for the last two years.This info came from the Italian Consulate. So it seems to me that the Italian Governement wants to know everything to the last cent we have (the Aust Tax Office already know this).
I like you wonder what other non eu residents do as it is very hard to find information, and we have come to the conclusion that either expats don't register as residents( don't know how this would work) or just don't pay tax because maybe they are not aware they should.
Anyway I could go on and on, my only advice is disregard a lot of stuff you read on the internet and find a really good expert.
Good Luck and if you need a Red Cross Parcel (you know food and other stuff) I will happily send you one from Australia.lol
Regards
JACHA

highlander1

It seems an extraordinary amount of effort to go to Italy for 12 months !
Do you think it is worth it ?

However imo the 0.76% is not on worldwide assets but on property value.
.. and in any case you would have to pay tax just on part of the year, if you plan to stay 12 months, and maybe after you have left !?!..

It is not incredible that thousands of migrants enter Italy without documents, are not registered and the authority are not bother, but if you are from Australia....

modicasa

The tax year is the calendar year in Italy, so if you were to arrive Jan 1 and leave Dec 31, you would have to submit a tax return by 16 July the following year following your departure. Of course if you weren't here to file a tax return they could never know.....

highlander1

My point entirely... very well put.

JACHA

It does seem a lot of work and information to provide for 12 months. The only problem with overstaying the 90 days is we would be quite nervous about something going wrong or us looking so guilty we would look like we have done something wrong. Mostly the health cover and travel insurance will not cover you if you are in the country unlawfully. I might add I think it is reasonable that people pay the local tax as you are there using the services. It is just the other bit that bothers us. The tax treaty allows us not to pay income tax in Italy as we still have to pay tax here in Australia as the money is earnt in Australia. Thats about the only good thing about the tax treaty. Surprisingly Italy has a higher tax rate than we do as the first $18,000 of your income is tax free here.
The Australian Tax Office doesn't care what taxes we have to pay in Italy as their response was "Italy has a right to charge us any other tax except income tax" as that is covered by the tax treaty" once you have stayed in Italy over 183 days.
Oh well we will keep thinking about it. Not the tax part, just the chance to live in a beautiful country for awhile.

philat98

"The tax year is the calendar year in Italy, so if you were to arrive Jan 1 and leave Dec 31, you would have to submit a tax return by 16 July the following year following your departure"
It could be worse if you arrived on 30 June and departed 1 July the following year. That would be 2 full tax years.

I wonder how you prove that you departed from the country?

modicasa

If you have apply for residence, you also tell them that you are emigrating when you leave.

Donna Noble

So, this has been an eye-opener for many of us. And I shall endeavour to be more on the ball in the future.

In this case we have given our 730 for previous years (back to 2010 he suggested) to our new accountant with the updated information regarding UK bank accounts and he is going to sort it out for us. There will be a fine to pay so I was hoping this would be done before we go on holiday in August but due to his other deadlines we have to wait until September to finalise everything now.

All I can say is thank goodness the "ravvedimento operoso" law came into being this year. Otherwise we would have been well and truly scuppered.

In trying to get my head round all of this, I have a question regarding rental income from the UK that I shall ask in a new thread.

Thank you everyone for your help regarding this one!

Donna

philat98

There must be quite a bit of work in going back to 2010 particularly when the UK tax year is based around April.
Funny thing is after all the stress and expense the Fisco don't even give you a receipt. At least HMRC give you a tax statement.