A foreign professional in Italy saves €21,500. A business owner saves nothing.

Italy has spent a decade advertising itself to people who might move there to work. The offer is real and it is large: bring your tax residence to Italy, meet the conditions, and for five years only half your income counts towards income tax at all.1 On €100,000 of income that is €21,500 a year — the difference between €35,200 of IRPEF and €13,700, on the bands in force for 2026.45

Open a business rather than a practice and the figure is zero. Not reduced, not tapered: the article lists the kinds of income it applies to, and business income is not one of them. Until the 2023 tax year it was.

Three kinds of income, and a fourth

The relief for 2024 onwards is article 5 of D.Lgs. 209/2023. Its first sentence names i redditi di lavoro dipendente, i redditi assimilati a quelli di lavoro dipendente, i redditi di lavoro autonomo derivanti dall’esercizio di arti e professioni — employment income, income treated like it, and self-employment income from arts and professions.1 Three categories, and the article never adds a fourth.

The relief it replaced named four. Article 16 of D.Lgs. 147/2015 covered employment, assimilated and self-employment income in its first comma, and then comma 1-bis said that the regime si applica anche ai redditi d’impresa prodotti dai soggetti identificati dal comma 1 o dal comma 2 che avviano un’attività d’impresa in Italia — it applies as well to the business income of those people when they start a business in Italy, from the tax period after the one current at 31 December 2019.2 Comma 9 of the new article repeals article 16 outright, keeping it alive only for people who had registered residence in Italy by 31 December 2023.

Whether that sentence covers you is not a matter of what you call yourself. Italian income tax sorts what you earn into categories, and two of them are at issue here. Article 53 of the income-tax code makes self-employment income the income of arti e professioni, expressly other than the activities dealt with in the chapter on business income. Article 55 makes business income the income of commercial enterprise — and adds, in its second comma, income from attività organizzate in forma d’impresa dirette alla prestazione di servizi: services, if they are organised as an enterprise.3 So the same work, done by the same person with the same qualifications, falls on one side of the line or the other depending on how the activity is set up. A consultant billing for their own professional services is in article 53. The same consultant running a studio with staff, stock and a shopfront is in article 55, and out of the relief.

There is a narrowing inside the surviving category too, and it is easy to miss. Article 16 said redditi di lavoro autonomo without qualification, which is the whole of article 53 — including the second comma, where the code puts an author’s income from exploiting their own work, and an agent’s termination indemnity. Article 5 says redditi di lavoro autonomo derivanti dall’esercizio di arti e professioni, which is the first comma only.

What the exemption is worth

Income tax in Italy runs 23% to €28,000 of taxable income, 33% to €50,000 and 43% above.4 Halving the income that reaches those bands does not halve the tax: it moves the whole of it down the ladder, so the exemption is worth proportionally more the higher the income.

At €100,000 the four lines read €35,200, €13,700, €7,100 and €2,300. That is a spread of €32,900 on identical income in a single tax year, and the top of it is fifteen times the bottom. None of it is about what the four people do for a living.

Two things are held out of those figures and both matter. There are no credits and no regional or municipal surcharges, which would widen the gaps. And there are no deductible charges — in particular no pension contribution, which article 10 of the code lets a professional deduct in full whether or not the relief applies.10 Put a 26.07% Gestione Separata contribution back in and the €21,500 becomes €18,486, because both sides fall down the bands together. That column ships with the data; the headline figure is the one without it, and it is the more generous of the two.

The people who moved a year earlier

The older relief has not finished. It runs for the year of the transfer and four more, so someone who registered residence in Italy in 2023 is inside it until the end of 2027, on 70% exempt rather than 50% — and on 90% if they moved to Abruzzo, Molise, Campania, Puglia, Basilicata, Calabria, Sardinia or Sicily, which article 16 named and article 5 does not.2 On €100,000 of income that is €6,600 a year between two people who did the same thing twelve months apart.

The rest of the rewrite moved in the same direction. The wait abroad before you qualify went from two tax periods to three, and to six or seven if you come to work for the employer you already had. The promise to stay went from two years to four. A cap appeared at €600,000 of relieved income a year, where there had been none. The five-year extension for a parent or a homeowner went. And the relief acquired a qualification test the general route never had: article 5 asks for requisiti di elevata qualificazione o specializzazione, the standards written for the EU Blue Card and for recognised professional qualifications, or else research work in artificial intelligence, a phrase the article’s most recent amendment added with effect from 10 October 2025.

The one door left for a business

Business income is not entirely without a relief in that decree. Article 6, two pages after the one everybody reads, keeps half of the income of an economic activity out of the tax base for six tax periods.7 It is a different instrument for a different situation, and three conditions decide whether it is any use to a person moving to Italy.

It wants an activity trasferita — carried on in a country outside the European Union and the European Economic Area and then moved to Italy. A business founded in Italy has not been transferred from anywhere, and a business moved from Berlin or Barcelona comes from inside the Union. It excludes anything carried on in Italy in the preceding twenty-four months, and it takes the tax back if the activity leaves Italy again in the five tax periods after the relief ends, ten for a large firm. Its last comma makes the article’s own effect subject to authorisation by the European Commission under the State-aid rules, which is a condition on the provision rather than on the taxpayer.

So the person the 2024 rewrite left out — someone who arrives in Italy and starts a business here — is not picked up by article 6 on any reading of it.

What else the relief asks for

The exemption is not automatic for a professional either. Article 5 asks for three tax periods of tax residence outside Italy first, a commitment to stay four years with the benefits recovered if you leave sooner, work performed in Italy for most of the tax year, and the qualification test. It applies within the de minimis State-aid ceilings, which article 16 did not mention at all. It runs from the year residence moves and for four more, and stops.

One consequence is worth stating plainly because it decides whether any of this is relevant at all. The relief works by keeping income out of the base that income tax is charged on. The flat-rate regime does not charge income tax — it charges a substitute tax on a fixed percentage of revenue — so there is nothing for an income-tax exemption to reduce, which is the same reason the 2026 rate cut was worth nothing inside it.9 A new arrival billing under the €85,000 flat-rate ceiling is choosing between two regimes, not stacking them. Above that ceiling the choice closes and the relief is the only one left.

What this does not settle

These figures are income tax on an amount of income, and nothing else. They do not say what anybody takes home: contributions, credits, family circumstances and the regional and municipal surcharges all sit outside them, and the surcharge alone varies by comune. Nor do they compare a professional and a business owner as people — a business deducts its real costs and a professional generally does not, so two people with the same turnover do not arrive at the same income. What is held constant here is the income; what moves is the share of it the statute lets through.

Whether a particular activity produces professional income or business income is a question about that activity, and the code decides it by how the work is organised rather than by what it is called. This piece does not answer it for anyone. It reports what the two articles say and what the bands produce once the answer is known.

The 2027 income-tax code does not change any of it. The relief is carried into article 225 of D.Lgs. 117/2026 with the same three categories, the same 50%, the same €600,000 cap and the same conditions — the recodification that leaves the flat-rate regime’s numbers untouched does the same here.8 Whatever brings business income back into this relief, it has not been written yet.