Italy Fiscal & Treaty Framework
1. Bilateral Tax Accord & Jurisdictional Allocation (Italy)
Relocating from Italy to Spain activates the provisions of the Convenzione tra l'Italia e la Spagna per evitare le doppie imposizioni (1977). Under Article 15 of this bilateral accord, employment income is strictly allocated based on physical presence. If you move your tax residency from Italy without electing the 24% Beckham Law regime via Form 149, the Spanish Tax Authority (AEAT) will subject your worldwide earnings to progressive Spanish income tax (IRPF) reaching up to 47% (and up to 54% in autonomous regions like Valencia).
By contrast, electing the Special Regime for Inbound Workers (Article 93 LIRPF) caps your Spanish employment tax at a flat 24% for active labor income up to €600,000 per year. Furthermore, foreign-sourced passive income (such as dividends, interest, or rental yield originating in Italy) remains 100% EXEMPT from Spanish income tax.
2. Taxation of Italian Piani di Stock Option (Art. 51 TUIR), RSUs, and Trattamento di Fine Rapporto (TFR).
A critical area of divergence for executives from Italy involves Italian Piani di Stock Option (Art. 51 TUIR), RSUs, and Trattamento di Fine Rapporto (TFR).. Under DGT Binding Ruling V0813-23, unvested equity grants are time-sliced across the vesting grant period: only the fraction of workdays physically performed on Spanish soil is added to your Spanish 24% taxable base.
Regarding corporate distributions, 15% Ritenuta d'imposta on Italian dividends under Treaty Article 10. This provides significant cash flow protection compared to standard non-resident rates.
3. Statutory Departure & Compliance Requirements
Prior to relocating from Italy, you must address local departure formalities: Agenzia delle Entrate Exit Tax (Art. 166 TUIR) and registration with AIRE (Anagrafe Italiani Residenti all'Estero). Mandatory AIRE registration within 90 days of moving to avoid Italian fiscal residence presumption (Art. 2 TUIR). INPS retirement benefits & TFR severance capital evaluated under Treaty Article 18.