Inbound employees tax regime: extension with a child born after residency relocation

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Article 16 of Legislative Decree 147/2015 introduced into the Italian legal system a particular tax regime for “inbound” employees designed to act as a further incentive to transfer their residence in Italy.
This particular tax regime provides that, for persons who move to Italy, the income from employment, self-employment and business is taxable for the 30% of its amount (10% if the residence is moved to Abruzzo, Molise, Campania, Puglia, Basilicata, Calabria, Sardinia and Sicily).
This tax regime generally last for five years.
Article. 5 of Legislative Decree 34/2019 (conv. L. 58/2019) has made significant changes to the tax regime to be effective from 30 April 2019.

In a nutshell:

  • the requirements have been expanded;
  • the taxable income has been reduced from 50% to 30% for the first five years;
  • the duration can be extended for other five years, and the income will be taxable for 50% of its amount (10% if the person has at least three minor children).

Regarding this last point, the conditions to be respected for the extension are, alternatively:

  • have at least one minor child;
  • purchase of at least one residential property unit in Italy, after the transfer to Italy or in the 12 months prior to the transfer.

Internal Revenue Service provided some clarifications regarding the requirement related to dependent child by saying that the tax regime can be extended for other five years even if the child is born after having transferred the residency in Italy.
For example, if someone moves to Italy in the 2020, the child (or children) can born within the 2024.