Key Aspects of the Italian Inheritance Tax System for Estate Planning in Italy

Inheritance taxes should, ideally, always be incorporated into detailed succession planning. It’s all too common for families to discover that, on receipt of an inheritance and amid the grief of losing a loved one, they also encounter a significant tax burden they hadn’t expected.

This applies to expats around the world, including those living in Italy who need to understand localised Italian succession law, which works very differently from the UK system they may be familiar with.

Chase Buchanan Private Wealth Management succession planning specialists have collated this short guide to outline the most important elements of inheritance tax for expats living in Italy, and to highlight recent reforms that took effect from January 2025.

Italian Inheritance Tax vs the System in the UK

Italian inheritance tax is called the Imposta di Successione, and unlike in some European countries, the rules are national, with no variations between regions. One of the big contrasts is that, in contrast to the UK, where inheritance tax is an obligation of the estate, in Italy, the individual heir is responsible for paying the arising tax charge.

There are personal allowances depending on the relationship of the inheritor to the deceased, but some beneficiaries will need to account for a secondary property tax called the Imposta Catastale. This is a property-specific tax assessed on the cadastral value, or nominal value of an inherited home.

Another variation is that inheritance tax rates vary by beneficiary category. The fairly generous allowances and comparatively very low tax rates mean most relatives will pay minimal inheritance tax, if any at all.

Importantly, inheritance tax applies to all inheritances distributed from the estate of a person who was an Italian resident, including worldwide assets. Therefore, beneficiaries inheriting cross-border assets may still have a tax liability to pay.

Inheritance Tax Rates and Allowances in Italy

Making a Will: Guidance for Expats Living in Italy

As with any country, it is strongly advisable to have a legally recognised Italian will, as this can have a major influence on the inheritance process, either through the testate process (where there is a will) or the intestate process (where there isn’t).

Italian law recognises three different types of wills:

• A testamento pubblico, or public will, which is prepared by a notary and witnessed
• A testamento olografo, which is a handwritten, signed will, and needs to be validated by a notary to be enforced
• A testamento segreto, which is a sealed, confidential will that is held by a notary and only opened once the benefactor passes away

The norm is for a notary to present the contents of a will to the beneficiaries before any inheritance can be distributed.

However, if there is no will, this can complicate matters. It also means that forced heirship rules will automatically be enforced, which is why it’s so important that expats always ensure they have a current, up-to-date will and don’t rely on a will held in the UK or another jurisdiction, which might not be honoured.

Understanding Forced Heirship Laws in Italy

Technically, forced heirship, part of Italian inheritance law, mandates a protected share of an estate that must be left to beneficiaries in certain groups, such as children. Outside those allocated proportions, individuals can distribute their estates as they wish.

Forced heirship can be complex, but as an idea, the legislation states that if the deceased had one child and no spouse, 50% of the estate must be allocated to the child; if they had two children and no spouse, the children receive 66% of the estate divided equally.

Italian residents who pass away with surviving children and a spouse are expected to distribute 50% of their estate assets to the children, and 25% to the spouse, and spouses maintain ‘lifetime rights’ to inheritances.

There are, though, solutions for expats who wish to leave certain assets or wealth to loved ones outside of those rules, such as electing to apply Brussels IV – although this requires professional guidance.

Declaring Foreign Assets for Italian Inheritance Tax Purposes

As we’ve mentioned, reforms took effect from January 2025, which have had an impact on Italian inheritance tax, with some of the most notable changes as follows:

• Beneficiaries are now required to self-assess their inheritance tax and provide this calculation and expected tax bill when they submit the Declaration of Succession.
• Self-assessed inheritance tax is payable within 90 days of the submission of the documentation, the latter of which is usually registered within 12 months.
• The Italian authorities will check self-assessments, but the onus is on the recipient to determine how much inheritance tax they need to pay, and to apply the correct allowances and rates.

Additional changes to the Italian inheritance tax regime relate to the inclusion of assets transferred through trusts in the scope of inheritance tax and the removal of the old Coacervo rule, which now means that gift tax allowances are entirely separate from inheritance tax allowances.

Expats living in Italy as tax residents will be liable for inheritance tax on all their worldwide assets and wealth, and inheritors who also reside in Italy will need to calculate and report all assets received and pay the resulting tax, after deducting their tax-free allowance.

The UK and Italy do have a double tax treaty, which protects expats from paying duplicate inheritance tax on the same assets and wealth. It remains advisable to seek professional support to ensure you apply tax treaties correctly.

Succession Planning Assistance for Italian Expat Residents

Inheritance tax is rarely straightforward, but the complexities around self-assessment, forced heirship, and varied allowances mean foreign nationals living in Italy are advised to ensure they have a comprehensive understanding of how their estate will be managed, by whom, and whether they have made the provisions to retain the right to leave their wealth according to their wishes.

Further information about the inheritance tax system in Italy and how it applies to non-citizens is available by contacting the Chase Buchanan Private Wealth Management team directly.

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*Information correct as at December 2025