Sicily refund vs 7% flat tax vs impatriati: which should you take?
Italy has three tax incentives for people moving from abroad, and you can only have one. Worked numbers for pensioners and remote employees, including when the Sicilian refund is the wrong choice.
Sicily’s new-resident refund cannot be combined with any other national or regional incentive for attracting residents. The decree makes you declare, in writing, that you haven’t applied for the others (art. 6, lett. d). So this is a choice, not a stack.
Here is the uncomfortable conclusion up front: if you qualify for one of the other two regimes, it usually beats the Sicilian refund. We would rather tell you that than sell you the wrong move.
The three regimes
| Sicily refund | 7% flat tax | Impatriati | |
|---|---|---|---|
| What you get | 50–60% of IRPEF refunded | 7% flat on all foreign income | 50% of income exempt |
| Duration | 3 years | 9 tax periods | 5 tax periods |
| Who it’s for | Employees & pensioners | Foreign pensioners | Highly qualified workers |
| Years abroad needed | None | 5 | 3 (6–7 if same employer) |
| Where you must live | Any Sicilian comune | Southern towns ≤30,000 | Anywhere in Italy |
| Must buy property? | Yes, within 12 months | No | No |
| Covers freelance income? | No | Foreign income only | Yes |
| Income cap | €100,000 refund/year | — | €600,000 of income |
The legal references, if you want to check us: art. 25 of Regional Law 1/2026 and D.D.G. 1017/2026 for the Sicilian scheme; art. 24-ter TUIR for the 7% regime; art. 5 of d.lgs. 209/2023, as amended by Law 132/2025, for impatriati.
If you’re a pensioner
The 7% regime charges seven per cent on all your foreign-source income — pension, dividends, rent, capital gains — for nine tax periods. That is very hard to beat.
| Your situation | Sicily (3 yrs) | 7% flat tax (9 yrs) | Take |
|---|---|---|---|
| €30,000, small town | €12,852 | €45,360 | 7% flat tax |
| €40,000, small town | €19,152 | €70,560 | 7% flat tax |
| €70,000, small town | €40,932 | €160,560 | 7% flat tax |
| €40,000, living in Palermo | €15,960 | not available | Sicily |
On a €40,000 pension the flat tax is worth nearly four times as much. The duration does most of the work: nine years against three.
So when does Sicily win for a pensioner? In three real cases:
- You want to live in a city. The 7% regime caps out at 30,000 residents. Palermo, Catania, Messina, Siracusa, Ragusa, Trapani and Marsala are all out. The Sicilian refund works in any comune.
- You’ve been abroad fewer than five tax periods. The 7% regime requires five; Sicily requires none at all. If you left Italy three years ago, Sicily may be your only option.
- Your income isn’t foreign-sourced. The 7% regime only touches foreign income.
One more thing the tables don’t show: the 7% regime works only if you’re coming from a country with a tax-information exchange agreement with Italy, and it applies to towns in eight southern regions — Sicily, Calabria, Sardinia, Campania, Basilicata, Abruzzo, Molise and Puglia. The 30,000 threshold itself is recent: it was 20,000 until 7 April 2026.
If you’re an employed remote worker
If you qualify as “highly qualified or specialised”, impatriati wins on every income level we tested — five years of a 50% exemption simply outruns three years of a 50% refund.
| Your situation | Sicily (3 yrs) | Impatriati (5 yrs) | Take |
|---|---|---|---|
| €60,000 | €27,660 | €56,500 | Impatriati |
| €80,000 | €40,560 | €82,000 | Impatriati |
| €80,000, small town (60%) | €48,672 | €82,000 | Impatriati |
| €150,000 | €85,710 | €161,250 | Impatriati |
Note the third row: even the enhanced 60% small-town rate doesn’t close the gap. And impatriati doesn’t require you to buy a house — a difference worth tens of thousands in capital, not just tax.
So when does Sicily win for an employee? Whenever impatriati is out of reach, which is more often than people assume:
- You’re not “highly qualified”. Impatriati requires a degree-level qualification or a specialised role. A great many ordinary remote employees don’t clear that bar. Sicily asks nothing about your job.
- You’ve been abroad fewer than three tax periods — or six to seven, if you’re returning to the same employer or its group.
- You were going to buy a home in Sicily anyway. Then the property condition costs you nothing you weren’t already spending, and the refund is free money on top.
If you’re a freelancer
The Sicilian refund gives you nothing — self-employment, business and professional income is excluded (art. 2, c. 1, lett. c).
Impatriati, by contrast, does cover self-employment income for qualifying professionals. If you’re a freelancer moving to Italy, that’s the regime to look at, and Sicily is simply not a factor in your decision. Our guide on who qualifies goes into what freelancers can realistically do.
The lock-ins nobody mentions
All three tie you down, in different ways:
- Sicily: keep your residence, fiscal domicile and the property until 31 December of the second year after you move. Sell early and the Region claws the money back with interest.
- Impatriati: commit to Italian tax residence for at least four years, or repay the benefit.
- 7% flat tax: it’s an annual option and can lapse, but if you move out of an eligible comune you lose it.
There’s also an administrative asymmetry. The Sicilian refund requires a separate application every single year, within a 1 September – 31 December window, on penalty of forfeiture, with a sworn statement from a licensed accountant each time. The other two are applied through your ordinary tax return. That’s three chances a year to lose money by missing a deadline — which is exactly why the scheme needs handholding that the others don’t.
So how do you choose?
Work through it in this order:
- Freelancer? Sicily is out. Look at impatriati.
- Pensioner, five-plus years abroad, happy in a town under 30,000? Take the 7% flat tax.
- Employee, highly qualified, three-plus years abroad? Take impatriati.
- None of the above? The Sicilian refund is very likely your best — and possibly your only — option. It’s the most accessible of the three: no qualification test, no minimum time abroad, no population limit.
That last point deserves emphasis, because it’s the real character of this scheme. Sicily’s refund isn’t the richest incentive in Italy. It’s the least exclusive one — designed to be claimable by ordinary employees and retirees whom the other regimes leave out, provided they commit to buying a home on the island.
Run your own numbers in the calculator →
Figures are gross of deductions and exclude regional and municipal surtaxes; they compare total benefit over each regime’s full duration. This is information, not advice — verify your own case with a licensed commercialista before choosing.