Italy is one of the most idyllic countries in the world with beautiful architecture, cities and quaint country towns and a deep and colourful culture and history, while its food and wine is renowned around the world. Added to that are its mild winters (especially in the South) and its warm climate in the Summer and it is easy to see why Italy has long been a popular destination for Irish and Northern European retirees.
If you plan to retire in Italy, you will need a Residence Visa. As members of the EU, Irish retirees however have the right to live in Italy without getting visas or a residence permit. If you are a non- EU citizen, you will need the Italian Retirement Visa.
A prospective Irish retiree must satisfy the following requirements (which are not exhaustive).
The Italian Government has recently introduced a range of tax incentives to encourage foreign retirees to relocate to Italy, one of these incentives is aimed at international retirees. This is a similar legislation to the more established regime offered by its neighbour Portugal (Non-Habitual Resident) which has attracted a sizeable number of EU and non-EU retirees since launching in 2009.
Italy offers a 7% flat tax rate on foreign Income and an exemption from reporting and tax on overseas assets. Part of the rationale for this scheme is to attract EU and non-EU pensioners to help re-distribute Income to the financially disadvantaged parts of Southern Italy. To be eligible for this incentive, you must be a non-Italian national and you must reside in certain Italian regions and towns with a population fewer than 20,000.
Ireland has a DTA agreement in place signed by Italy. This means that Irish sourced Income is not taxed in Italy. If a retiree has non-Italian sourced pension income this is liable to a flat 7% tax rate.
In Italy, a foreign retiree can get access to Italy’s excellent national health service (ranked in the Top 10 Worldwide by the WHO). For Irish retirees’ a private healthcare plan is recommended which can offer more advanced facilities and shorter waiting times.
The cost of living in Italy is inexpensive compared with Ireland. Excluding the cost of accommodation (rental or to purchase) most retired couples could live comfortably on c.€2,000 per month. The cost of living in Italy will depend on where you choose to live and your lifestyle. The Islands are less expensive than the mainland cities, while if you chose to live in the countryside the cost of accommodation, food and services is lower than the cities.
Rental properties for a one bed apartments in the cities vary from €950 pm in Rome to €700pm in Florence, while there is even better value in the South of Italy with one bed apartments in Bari ranging from €400-500 pm.
As soon as possible, it is never too early to start planning and we can help you avoid some of the common mistakes, even if you do not eventually retire abroad, we can help you make your retirement dreams a reality.