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How Italy Has Reshaped Tax Incentives To Attract Professional Athletes

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Wednesday, 27 July 2022 By Elio Andrea Palmitessa

Italy is currently well-rated as a privileged destination for professional sportspersons.

In 2019, a special regulation to attract athletes from abroad by improving inward cross-border mobility was introduced to the tax scheme for inbound workers[1] (the Regime). It allowed sports figures to transfer their tax residence to Italy enabling them to benefit from a partial tax exemption on domestic sourced compensation. The measure offered a two-fold tax break, by also granting employers (as football clubs) an indirect benefit through reduced wage withholding taxes and social contributions. For more information, please see this article by the author.[2]

Most recently, Law Decree No. 21/2022 tightened access to the Regime, establishing that the tax exemption may only be applied where more specific objective and subjective criteria are met. The new regulation applies from tax year 2022, requiring athletes to check their eligibility for the tax benefit. Nevertheless, the former provisions continue to apply to player tax residents in Italy as of December 31st, 2021, until the expiry of their current contracts of employment.

This article recaps the key points of the Regime and its special measures for sportspersons, before explaining the latest changes introduced in 2022.

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Written by

Elio Andrea Palmitessa

Elio Andrea Palmitessa

Elio is a chartered accountant in Italy, specialised in EU and International Tax Law. He holds an LL.M. degree (with honours) in International Tax Law at Vienna University of Economics and Business (Institute for Austrian and International Tax Law). He also received the TEP designation (Trust and Estate Practitioner), the top tier of STEP qualification.

He is a member of several Boards of Statutory Auditors, a member of the International Fiscal Association (IFA) and the International Bar Association (IBA).

He has published extensively in international tax journals as well as lectured in courses and conferences in Italy.

The author can be contacted at:

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