There are many reasons offered by British nationals resident in Italy as to why they fail to comply with the requirements for submitting an accurate Italian tax return;
“I’m retired, so I don’t need to.”
“All my money is back in the UK.”
“Pensions don’t count.”
“I am not on the radar.”
“They don’t know about my UK property.”
“I pay all my taxes in the UK so why should I pay here”
Letters from Agenzia delle Entrate ( Italian equivalent of HMRC ) are now beginning to land on the doorsteps of many British nationals.
Italy and the UK have been sharing financial information since 2016, so when the letter arrives you should be aware that the Agenzia will have a list of all of your foreign financial assets.
In the scramble to prepare a fully compliant and accurate set of Italian tax returns, all individual chargeable events and dividends must be calculated and accounted for relating to the periods under consideration.
Sounds easy enough.
No, the Italian system wants the numbers from 1 January to 31 December each year, not 6 April to 5 April as in the UK.
So, your defences need to be constructed without delay:
- Make sure your pensions and investments are Italian compliant.
- Engage a suitable professional to guide you through the reporting requirements.
- Determine your liability.
- Set funds aside to meet the tax bills and fines that will follow.
- Organise your assets to minimise future taxes.
If the letter hasn’t yet arrived, you are on the front foot, and can significantly reduce, if not eliminate the risks.
After all, attack is said to be the best form of defence.