IVIE (Imposta sul Valore degli Immobili situati all'Estero)

‍IVIE is a tax on the value of real estate properties held abroad by Italian tax residents. Its primary aim is to prevent tax evasion by ensuring that Italian residents declare and pay taxes on their foreign real estate holdings.

Key Points about IVIE:

  • Taxable Assets: IVIE applies to real estate properties located outside Italy.
  • Tax Rate: The tax rate is 1.06% on the value of the real estate.
  • Filing Requirement: Italian tax residents must annually declare their foreign real estate assets.
  • Deadline: The tax return must be filed by September 30th of the following tax year.
  • Tax credit: for certain countries Italy recognizes the foreign taxes paid abroad (to be deducted from the IVIE due).

IVAFE (Imposta sul Valore delle Attività Finanziarie detenute all'Estero)

‍IVAFE is a tax on the value of financial assets held abroad by Italian tax residents. It ensures that income earned from foreign financial assets is properly reported and taxed in Italy.

Key Points about IVAFE:

  • Taxable Assets: IVAFE applies to a wide range of financial assets held outside Italy, including bank accounts, securities, and other financial instruments.
  • Tax Rate: The tax rate is 0,2% on the value of the financial assets or 0.4% of the assets are located in a black-listed country.
  • Filing Requirement: Italian tax residents must annually declare their foreign financial assets.
  • Deadline: The tax return must be filed by September 30th of the following tax year.

Tax Planning Considerations:

  • Tax Residency: Both IVIE and IVAFE apply to Italian tax residents, defined as individuals meeting the criteria for tax residency in Italy.
  • Exemptions and Deductions: There are specific exemptions and deductions available that taxpayers can use to minimize their tax liabilities.
  • Penalties for Non-Compliance: Failure to comply with the filing requirements can result in penalties and interest charges.

Navigating international tax regulations such as IVIE and IVAFE requires careful planning and compliance.

At Move To Dolce Vita (MTDV), we specialize in international tax advisory and can assist you in understanding your tax obligations, optimizing your tax strategy, and ensuring compliance with Italian tax laws. Contact us today to learn more about how we can help you manage your assets held abroad and achieve your financial goals.

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