Singapore VCC insights

Italy Flat Tax for New Residents or Singapore: A Relocating Principal’s Comparison

By VCC Editorial Team · Published 6 November 2026

Short answer: For anyone moving to Italy from 1 January 2026, the Italy flat tax replaces Italian income tax on foreign income with EUR 300,000 a year, plus EUR 50,000 per family member, for up to 15 years. Singapore exempts most foreign income received by resident individuals at no fixed cost, but gives no fixed-price certainty.

This article is general information only and is not legal, tax or investment advice. For matters needing legal advice, we work with a panel of experienced Singapore law firms.

The Italy flat tax for new residents lets an internationally mobile principal put a fixed annual price on foreign income, and the 2026 Budget Law has just made that price higher. This comparison sets the Italian regime under article 24-bis of the Testo Unico delle Imposte sui Redditi (TUIR, Italy’s consolidated income tax code) against Singapore’s territorial approach for a principal relocating with family. All Italian and Singapore sources cited were checked on 6 November 2026, and Italian figures are quoted from the Gazzetta Ufficiale and the Agenzia delle Entrate (Italy’s revenue agency), not from secondary commentary.

What is Italy’s flat tax for new residents and what does it cost in 2026?

It is an optional substitute tax that replaces IRPEF (Italian personal income tax) on income produced abroad with a fixed annual sum. For individuals who move their residence to Italy on or after 1 January 2026, the sum is EUR 300,000 a year, plus EUR 50,000 for each family member to whom the option is extended.

The figure has tripled in under two years. The regime was introduced at EUR 100,000 a year with EUR 25,000 per family member, and the Agenzia delle Entrate’s guidance page still shows those original amounts. Decree-Law No. 113 of 9 August 2024, in force from 10 August 2024, raised the principal’s amount to EUR 200,000 for individuals transferring residence after that date. Law No. 199 of 30 December 2025 (the 2026 Budget Law) then amended article 24-bis(2) TUIR again: in the first sentence “euro 200.000” is replaced by “euro 300.000”, and in the second sentence “euro 25.000” is replaced by “euro 50.000”. Article 1(26) applies the change to individuals who transfer their residence to Italy, for the purposes of article 43 of the Civil Code, from the law’s entry into force, which the Gazzetta Ufficiale records as 1 January 2026.

The amount follows the date of the move, not the year of election: a principal who became resident in 2025 under the EUR 200,000 rules is not moved to EUR 300,000.

Who qualifies, and how is the option elected?

The regime is open to individuals of any nationality who have not been resident in Italy for at least nine of the ten tax periods preceding the first year of the option. Family members qualify on the same test and can be brought in by extension.

The Agenzia delle Entrate describes the sequence as follows:

1. Optionally, file an advance ruling request (interpello) with the Agenzia’s Divisione Contribuenti on the access conditions, stating the prior non-residence, the last jurisdiction of tax residence and any foreign states to be left outside the substitute tax, with the Agenzia’s checklist attached.
2. Elect the regime in the Italian income tax return for the tax period in which tax residence was transferred, or in the return for the following period.
3. Extend the option to qualifying family members in the return for the period in which each of them transfers tax residence, or the following one.
4. Pay the substitute tax for each year in a single instalment by the due date for the balance of income taxes, using the F24 form with tax code NRPP. The Agenzia states that late payment cannot be regularised through the ravvedimento operoso (voluntary correction) procedure.
5. Monitor the end points. The option renews tacitly each year, but lapses on revocation, on omitted or partial payment, or on a transfer of tax residence elsewhere, and its effects cease 15 years after the first tax period of validity. A principal’s revocation also ends the option for the family members to whom it was extended.

What does the Italy flat tax not cover?

The substitute tax covers foreign income only. Italian-source income, gains on qualifying holdings in the first five years, and income from any states the taxpayer chose to exclude all remain under ordinary Italian taxation.

• Italian-source income. The regime is defined as a substitute for IRPEF on “redditi prodotti all’estero” (income produced abroad). Italian employment, Italian rental income or profits drawn from an Italian business are taxed in the ordinary way.
• Qualifying shareholdings. Article 24-bis TUIR excludes from the substitute tax gains within article 67(1)(c), the category covering disposals of qualifying holdings, realised in the first five tax periods of the option, which remain subject to the ordinary regime in article 68(3). A founder planning an early exit needs to time the sale against that window.
• Excluded states. The taxpayer may nominate foreign states whose income is to stay outside the substitute tax. Income from those states is then taxed under the ordinary Italian rules instead.

On the transfer tax side, the Agenzia states that individuals who transfer their residence under the regime “have to pay inheritance and donation tax only for properties and assets existing within the Italian territory”. For a family with most of its wealth offshore, that is one of the regime’s most valuable features.

How does Singapore tax a relocating principal?

Singapore taxes on a territorial basis and exempts foreign-sourced income received in Singapore by resident individuals unless it comes through a Singapore partnership. There is no fixed fee to pay, no election to make and no fifteen-year limit.

• Tax residence. A foreign individual who stays or works in Singapore for 183 days or more in a calendar year is taxed at resident rates for that year. Resident rates are progressive, reaching 24% on chargeable income above S$1,000,000.
• Foreign income. IRAS (the Inland Revenue Authority of Singapore) states that “all foreign-sourced income received in Singapore by resident individuals, except those received through a Singapore partnership, is exempt from tax where the Comptroller of Income Tax is satisfied that the exemption is beneficial to them”.
• Capital gains. IRAS states that Singapore does not tax gains on the disposal of assets that are capital in nature, whether foreign or Singapore-sourced. Revenue gains, such as trading profits, are taxed as income.
• Section 10L. The rule taxing certain foreign disposal gains received in Singapore, for disposals on or after 1 January 2024, applies to an “entity” of a relevant group, which section 10L(16) of the Income Tax Act 1947 defines as excluding an individual. It matters for holding companies, not the principal’s personal gains.
• Estate duty. IRAS confirms that estate duty has been removed for deaths on and after 15 February 2008.

Our earlier note on Singapore tax residence for family office principals works through the residence test and section 10L in more detail.

Italy flat tax vs Singapore: how do they compare side by side?

Italy sells certainty at a fixed price for a fixed term; Singapore offers a structurally lower cost on foreign income without a term limit but without a ruling that fixes the outcome.

Issue	Italy (article 24-bis TUIR option)	Singapore (resident individual)
Tax on foreign income	Fixed EUR 300,000 a year for moves from 1 January 2026, regardless of amount	Exempt when received by resident individuals, except through a Singapore partnership
Family members	EUR 50,000 a year each if the option is extended	No additional charge; each person’s position depends on their own residence and income
Duration	Ceases 15 years after the first tax period of validity	No term limit; follows the general law
Entry condition	Non-resident in Italy for at least 9 of the prior 10 tax periods	183 days or more in a calendar year for resident rates
Domestic income	Italian-source income taxed under ordinary IRPEF rules	Singapore-source income taxed at resident rates up to 24%
Capital gains	Foreign gains covered, except qualifying holdings sold in the first 5 years	Capital gains not taxed; section 10L applies to entities, not individuals
Inheritance and gift tax	Due only on assets in Italy while the option applies	No estate duty for deaths on and after 15 February 2008
Advance certainty	Optional interpello on access conditions	No fixed-fee election; the outcome follows the facts each year
Residence route	Tax regime is separate from immigration status	Employment Pass, ONE Pass or Permanent Residence through the Global Investor Programme

The arithmetic is simple on the Italian side. A principal, spouse and two adult children who all elect pay EUR 300,000 plus three times EUR 50,000, or EUR 450,000 a year, whatever the family’s foreign income. Over a full 15-year term that is EUR 6.75 million in nominal terms, assuming the amounts are not changed again for existing participants. In Singapore the comparable charge on foreign investment income received by resident individuals is generally nil, so the question is how much income is Singapore-sourced or received through a partnership.

Where does the family office sit under each option?

Under the Italian regime the family office usually stays outside Italy, because Italian-source profits fall outside the substitute tax. In Singapore the family office can sit alongside the principal under the Monetary Authority of Singapore (MAS) single family office framework and, where it qualifies, a fund tax incentive.

The fixed charge on foreign income encourages keeping holding companies and their management abroad. Running them from an Italian home raises questions about where they are managed and resident, which need Italian advice before the move. Profits distributed by an Italian company would be Italian-source income outside the flat tax.

In Singapore, the revised MAS framework for single family offices took effect on 15 June 2026. It is a class exemption from licensing: a qualifying single family office notifies MAS within 14 days of starting operations, banks with a MAS-licensed bank and files an annual return, and existing ones have until 15 June 2027 to comply. Investment vehicles managed by the family office can apply for the section 13O or 13U fund tax incentives, whose conditions are set by MAS.

Some families combine the two, with the principal in Italy and a Singapore family office managing the Asian portfolio. That works only if the Singapore entities are genuinely managed in Singapore, and it needs coordinated advice in both countries.

What does Italy offer that Singapore does not?

Italy offers a European Union base, a fixed tax cost whose access conditions can be confirmed in advance, and an inheritance and gift tax shield on foreign assets.

• Certainty. A family with large or volatile foreign income knows its Italian income tax cost each year. Singapore’s exemption is broad, but rests on the facts each year.
• Location. For families whose businesses and schools are in Europe, an Italian base avoids long-haul travel.

Singapore’s advantages lie elsewhere: no fixed fee, no 15-year end point, no estate duty at all, and a family office regime that the principal can run from the same city. Our eleven-hub scorecard places these factors alongside other jurisdictions.

How should a family run the numbers before choosing?

Map income by source and holder, price each option on realistic income and family size, and test what happens at the end of year fifteen.

1. Map each family member’s income by type and source country, and identify any Italian or Singapore-source income.
2. List planned disposals of significant shareholdings in the next five years, because those gains sit outside the Italian flat tax in the first five years of the option.
3. Count the family members who would elect, at EUR 50,000 each a year in Italy.
4. Decide where investment holding companies and the family office will be managed, and take advice on their residence under each plan.
5. Plan for the exit: in Italy, ordinary taxation resumes on foreign income when the option ends unless the family relocates; in Singapore there is no equivalent cliff.
6. Confirm the immigration route. In Singapore, that means the Employment Pass, the ONE Pass or the Global Investor Programme; Singapore Employment Agency covers the pass and residence options.

Families leaving the United Kingdom should read this with our UK non-dom moving to Singapore guide on the exit timeline, and the ONE Pass family office test explains the S$30,000 monthly salary criterion.

Frequently asked questions

Is the Italy flat tax now EUR 300,000 for everyone?

No. Law No. 199 of 30 December 2025 applies the EUR 300,000 figure to individuals who transfer residence to Italy from 1 January 2026. Those who moved earlier keep the amount that applied when they transferred: EUR 200,000 for moves after 10 August 2024, and EUR 100,000 before that.

How much does each family member cost under the Italian regime?

For moves from 1 January 2026, EUR 50,000 a year for each family member to whom the option is extended. The amount was EUR 25,000 before the 2026 Budget Law.

Does Singapore tax foreign income that a resident individual brings into Singapore?

Generally not. IRAS exempts foreign-sourced income received in Singapore by resident individuals, except income received through a Singapore partnership. Income from a trade or business carried on in Singapore is a separate question.

Does section 10L tax a principal’s personal foreign gains in Singapore?

No. Section 10L of the Income Tax Act 1947 applies to an entity of a relevant group and defines “entity” to exclude an individual. It can apply to family holding companies.

Can I get advance confirmation that I qualify for the Italian regime?

Yes. The Agenzia delle Entrate accepts an optional interpello on the access conditions before the option is exercised, filed with its Divisione Contribuenti together with the prescribed checklist.

Does Singapore have inheritance tax?

No. IRAS confirms that estate duty was removed for deaths on and after 15 February 2008.

Sources

• Gazzetta Ufficiale: Law No. 199 of 30 December 2025 (2026 Budget Law), article 1(25) and (26)
• Agenzia delle Entrate: Neo residenti, regime opzionale (che cos’è)
• Agenzia delle Entrate: Tax regime for new residents
• Singapore Statutes Online: Income Tax Act 1947, section 10L
• IRAS: Individual income tax rates

Raffles Corporate Services helps relocating principals and their family offices set up in Singapore, from VCC incorporation and family office set-up to ongoing compliance alongside their European advisers. Email hello@rafflescorporateservices.com or Call/SMS/WhatsApp +65 8501 7133, or visit Raffles Corporate Services.

Last reviewed: 6 November 2026. The Editorial Team, Variable Capital Companies Act.