Our free review explains how your pension and retirement income can be affected post Brexit. Understand how to protect and secure your residency and retirement income abroad.
Expats looking for a relaxed lifestyle could do a lot worse than living in Italy.
As you can imagine, the country offers amazing food and wine, a great climate, and a rich history and culture. Of course, it’s impossible to overlook the romantic nature of some of Italy’s best-known cities.
Italy is also a popular retirement destination for expats from all over the world, and for good reason.
Its climate, its colours, cultural riches and the very essence of the Mediterranean living are the prime reasons so many expats have already packed their bags and moved to the country.
Inside the guide:-
- The pros and cons of living in Italy
- Living in Italy after Brexit
- Residency in Italy for non-EU citizens
- Alternative ways to residency in Italy
- Where to live in Italy
- How much money do you need to retire to Italy?
- Italian flat tax for expat retirees
- Where is the cheapest place to retire in Italy?
- Is living in Italy expensive?
- Buying property in Italy
- Does the UK have a double taxation agreement with Italy?
- Banking and bank accounts in Italy
- Healthcare in Italy
- Getting connected in Italy
- Final thoughts on living in Italy
The pros and cons of living in Italy
Moving from a grey and rainy country like the UK to anywhere in Europe can seem like an amazing idea. But is Italy really all it’s cracked up to be?
It’s fair to say that Italy has plenty to offer expats wanting a life of sunshine and good food. However, it’s worth weighing up both the pros and the cons to see if the lifestyle is suitable for your needs.
The positives: 5 reasons why Italy is such a good place to live
1. It’s a food-lover’s delight
If you’ve already been to Italy you’ll know this to be true. If you haven’t, this probably isn’t that much of a surprise. The country has a worldwide reputation for amazing food; it’s deeply ingrained into local and national culture and customs.
You may well be a fan of Italian food, but the quality you’ll find in the country itself is next level. Ingredients are incredibly high quality and are locally sourced wherever possible. Cooking is a very well respected occupation, which is reflected in the food.
2. Healthcare is very high quality
Italy has a regional based nationalised healthcare service known as the Servizio Sanitario Nazionale. It’s very high quality and is often ranked in the top 10 healthcare services in the world.
Of course, you need to be a resident before you can access it, but private healthcare isn’t expensive either.
3. Even small towns have great nightlife
It’s no secret that Italy produces some great alcohol and even greater cocktails. But it would be a bit obvious to make this a pro on its own. Luckily, Italy boasts amazing nightlife pretty much everywhere.
Whether it’s dining out, visiting a bar, going to a concert, or simply going for a walk, Italian nightlife doesn’t disappoint.
4. Property is affordable and accessible
You don’t even need to be an Italian resident to buy property in Italy. You’ll be able to continue using it as a holiday home and then move there permanently once you obtain residency. What’s more, property is pretty affordable, especially in the south.
5. Italy is known for its community spirit
Family and community are both important concepts in Italy. Providing you’re willing to put in some effort, it won’t be difficult to integrate into even a small, tight-knit community. Of course, in more rural areas you’ll definitely need to have a good grasp of the language.
The not-so positives of living in Italy:
1. You’ll need to know the language
This isn’t really a negative, but it can be a barrier.
Italian isn’t a widely taught language in the UK, meaning fewer people have any kind of prior experience with it. Luckily, thanks to the large proportion of English words that have Latin roots, learning Italian isn’t too difficult.
As previously mentioned, you’ll need to speak fluent Italian to obtain permanent residency.
English is more widely spoken in larger cities, but rural areas rely pretty much entirely on Italian. German is spoken in some northern areas, so bear this in mind if you already speak it.
2. Rental leases are very long-term
Renting in different places around a country is a good way of getting a feel for the best areas. This isn’t as easy in Italy because rental leases last a long time.
A short-term lease will usually last for around 18 months, and long-term leases last a minimum of three years, if not more. Being stuck in one area can make property hunting a challenge.
3. Cities can be busy (and a bit dirty)
Bigger Italian cities are prime tourist territory and can get very busy in peak season. Also, graffiti is common, as is grime from pollution and lack of cleaning. However, rural areas and smaller towns generally don’t suffer from these problems in the same way.
Living in Italy after Brexit
As with other European nations, Brits with legal residency in Italy before the Withdrawal Agreement came into place will have their rights and status protected. But what about those planning to move to Italy in 2021 and onwards?
Residency in Italy after Brexit
Now that the UK is no longer in the EU, free movement has ended.
This means you can visit Italy for up to 90 days without a visa. However, this can only be once in a 180-day period, which means you can spend roughly 6 months of the year in the country with a 3-month gap between stays.
For trips longer than 90 days and less than a year, you’ll need a long-stay visa. These are valid for 12 months, after which you’ll need to renew.
You have various options for visa application, one of which is elective residency.
Once in the country, you can apply for a temporary residency permit at your local police station.
You must have lived in Italy for a minimum of 5 years before applying for permanent residency, and the application also requires the following:
- Clean criminal record
- You must be able to speak Italian fluently
- You must know national customs
- You must have evidence you can support yourself financially
We’ll cover this topic in more detail later in the guide.
UK driving licences in Italy
Once you become a resident in Italy, you’ll need to exchange your British licence for an Italian one. If you started this process before 1st January 2021, you don’t need to take a test.
However, moving forwards, Brits will need to take an Italian driving test to obtain their licence. The process also requires you obtain a new picture and have the licence registered to your Italian address. Once you become an Italian resident, you’ll no longer be able to get your UK licence renewed.
If you take your British car to Italy, you’ll need to get it registered with Italian plates within 60 days of becoming a resident. Not doing so will result in your car being impounded.
Pet passports after Brexit
EU pet passports are no longer valid after the UK left the EU. These documents were a convenient way of taking pets on holiday, and were also necessary to take pets with you when you move.
The new requirement is to have an animal health certificate (AHC), and your pet needs:
- A microchip
- Valid rabies injection
- Tapeworm treatment
Your AHC must be issued by a valid vet and is valid for 10 days between issue and entry into the EU. Once there, it’s valid for 4 months for re-entry into the UK.
As you may have guessed, you need a new certificate for each journey. You can check out the UK government’s website for more information.
UK bank accounts in Italy after Brexit
Surprisingly, the Withdrawal Agreement contained many flaws in relation to the finance sector, as was widely reported in the media.
Several major UK banks have closed accounts belonging to expats due to lack of regulation. Banks such as Barclays, Nationwide, and Lloyds have all ceased operation in Italy.
So what can you do about this if you plan on living in Italy? There are a few options for managing your money abroad.
One is to check which banks will still operate in the EU, and luckily there are a few.
Another option is to see if your bank now has an EU base that can take up your business, although this isn’t always guaranteed.
A final option is to switch to an online money service while you wait to open an Italian bank account (which is a good idea regardless).
Second home owners in Italy after Brexit
Second homeowners in Italy are unaffected by Brexit. They retain their ability to own property in Italy, as you don’t need to be a resident to do so.
However, you can only stay at your property for 90 days within a 180-day period. This gives you roughly 6 months of the year with 3-month gaps.
If you want to stay in your second home for longer than 90 days you’ll need to apply for a visa.
This entitles you to 12 months residency, after which you’ll need to either leave or renew your visa. Of course, if you decide to move to your Italian home permanently, you’ll need to follow the standard visa application process.
Starting at the end of 2022, the EU is launching the European Travel Information and Authorization System (ETIAS). In short, this will mean all trips to the EU – of any length – will require authorisation.
Residency in Italy for non-EU citizens
Like most countries, Italy has several different kinds of long-stay visa. As mentioned, you need to apply for one of these if you plan on staying in the country for more than 90 days at a time.
The elective residency visa – also known as the retirement visa – is perhaps the most relevant for self-sufficient people. To be eligible for this kind of visa, you must elect to not work in Italy and have sufficient finances to support yourself.
The requirements include:
- A minimum of €31,000 a year for a single person or €38,000 a year for a married couple. This amount increases by 20% for every dependent.
- Proof of address, which can either be an owned or leased property.
- Proof of health insurance, which must cover €30,000 and all medical expenses. Once a resident, you can use public healthcare.
- Valid passport.
- Civil status documents (marriage and birth certificates).
- Proof of a clean criminal record from your home country.
You have to apply for an Italian retirement visa in your home country at the Italian consulate before you move to Italy. Once in Italy, you can then apply for a temporary residence permit after eight days.
If your plan is to take “halfway retirement”, such as opening a B&B or similar, you’ll need to apply for an Italian working visa – specifically a self-employed visa.
The application process is fairly similar, but you need something called a Nulla Osta, which is authorisation to perform self-employed work in the country.
Regardless of which visa you acquire, once you’re a permanent resident in Italy you need a digital biometric ID. You can apply for one at your local police station, and it’s a legal requirement to do so.
There are various fees involved in the Italian residency process, along with quite a bit of paperwork.
However, there are various Italian relocation services designed to make the process much easier for expats. They assist with paperwork, applications, translations, and much more. While an extra cost, it certainly justifies itself due to how much stress it’ll save.
Alternative ways to residency in Italy
Although the visa application process isn’t particularly difficult, there are quicker and possibly easier ways into the country.
Italy offers an investment visa with amounts ranging from €500,000 to over €2 million. Investments can be in government bonds, businesses, or startups.
Italian investment visa
Unlike other European countries, Italy doesn’t have a Golden Visa programme. However, in 2017, it launched the investor visa, which covers similar ground to Golden Visa programmes.
You have a couple of options for how you can invest your money:
- Government bonds issued by the country
- An Italian operated and incorporated company
- Startups based in Italy
- A charitable donation in fields of culture, research, education, culture, or natural heritage
The minimum donation is €500,000, but the amount you invest depends on where you plan to invest the money. For example, you need to invest €2 million in government bonds, donate €1 million to charity, or invest €500,000 in a business or startup.
You also need to have evidence of an annual income of €100,000, but this can come from various sources, including other investments, stock, annuities, and so on.
If you make a substantial investment in Italian property, the annual income requirement drops to €35,000. While there isn’t an official figure for this “significant investment”, consider it to be somewhere around €500,000.
Unlike other visa programmes, you need to go directly through the Italian Ministry of Economic Development. You begin by submitting an application on their website, and, providing this is successful, you then have six months to apply for a visa at an Italian embassy.
Once in the country, you’ll need to visit a local police station to get the investor residency permit. This is valid for two years, and to renew it you need to maintain your investment (rather than making another).
An Italian investment visa is definitely one way of speeding up the application process. Importantly, too, it offers a much greater chance of successful application and eventually leads to permanent residency.
Where to live in Italy
One of the best things about Italy is that it offers plenty of regional variations in lifestyle, climate, and scenery. Whether you fancy the Renaissance heritage of Florence or Venice, the bustle of Rome, or the island lifestyle of Sardinia or Capri, Italy has plenty to offer.
Here’s a roundup of some of the best choices for where to live in Italy.
Located on the north-western coast, Liguria is quite a tourism centred region. There’s good reason for this because it’s got an amazing coastline, boasts beautiful weather, and stunning scenery.
If you don’t fancy dealing with too many tourists, moving away from the coast will result in a much quieter life surrounded by Italian families.
As you can imagine, Rome is a prime location for the real Italian experience. There’s plenty of cultural heritage and some of the best restaurants in the country.
Tourism is a big deal here, and even in the off-season it’s still a busy place. City living isn’t suitable for everyone, but if it appeals to you then Rome should be top of your list.
Located in Tuscany, central Siena has been designated a UNESCO World Heritage Site. It’s full of museums, art galleries, restaurants, and historic buildings, making it a great choice for those wanting culture.
If you don’t want to live in the city itself, consider moving to a smaller town like Montepulciano, San Gimignano, Buonconvento, or Pienza. All are less than 50 kilometres from the city.
Naples is the third-largest city in Italy, located on the south-western coast. Its food offerings stand out, even amongst Italian cities, and you have historic sites like Pompeii, Herculaneum, and Vesuvius in easy reach.
It has an international airport and plenty of smaller satellite towns if you don’t want an inner-city home.
Parma is a central city located in the north of Italy. Famous, of course, for its ham, the city also boasts a deep cultural heritage and good connections to nearby historic centres.
For example, Florence is roughly 2 hours away by car. Parma has a great climate, exciting nightlife, and plenty to do all year round.
- The Best Places To Live In Italy For Expats – a detailed overview of the most popular expat destinations
How much money do you need to retire to Italy?
The Italian retirement visa requires you have an annual income of between €31,000 and €38,000. This works out as a minimum of €2,500 a month. Luckily this figure doesn’t just cover pension income, it includes other financial sources, such as investment and annuities.
It’s worth noting that you’ll be able to do quite a lot with this kind of income in Italy.
Italian flat tax for expat retirees
Italy offers a great tax discount for expat retirees: if you retire to Italy, you will pay seven percent tax on your pension income for the first 9 years of residency.
However, after your nine-year tax-free residency expires, you are liable for income tax at Italian rates ranging from 23 percent on income up to €15,000 (£13,500) to 43 percent on income over €75,000.
- Italian Taxes & Tax Advantages For Expats Explained – all about the flat tax for retirees, the non-dom tax, expat workers tax relief in Italy, Italian income tax rates and property taxes
Where is the cheapest place to retire in Italy?
Currently, the cheapest place to retire in Italy is either Palermo, Sicily, or Bari, on the Adriatic coast. The cost of living ranges from €900 to €975.
These towns have little interest for tourists, making them particularly quiet. That said, they still offer plenty of heritage and culture, but a more Italian, localised version.
Bari is a medieval town that, until recently, has flown under the international radar. Increasing numbers of cruise ships have been docking there in recent years, which has led to an overhaul in amenities.
However, property prices and cost of living are still considerably lower than elsewhere. You can easily pick up a nice apartment for €70,000 and exquisite villa and trulli for less than €500,000.
That said, a renovation project will go for next to nothing if you’re willing to put in a bit of work.
The same is true for Palermo in Sicily. You can find a house in the city centre for as little as €40,000 or an out-of-town villa for €80,000.
Sicily is a beautiful island with a warm, Mediterranean climate. Realistically, many of its towns have low property prices, but Palermo has the benefit of being a bustling city with plenty of activities.
Is living in Italy expensive?
The cost of living in Italy is 1.6% higher than in the UK, but property prices and rent are up to 30% cheaper (according to Numbeo). Overall, this definitely balances out in your favour.
Of course, the cost of living will vary massively depending on where you decide to settle down. For example, larger, busier cities like Rome and Milan will have a much higher cost of living. But this is true for pretty much everywhere in the world.
Rural areas will be much, much lower in terms of property prices and cost of living. You might find things like clothing are more expensive here, but the bigger financial picture is what’s important.
Property will be your most significant expense, particularly if you rent.
Usually it’s a good idea to move around a country renting to get an idea of where to live, but as mentioned this can be a challenge in Italy. Instead, it’ll be worth trying to buy a property as soon as possible, ideally outright if you can afford it. Doing so will drastically reduce your monthly expenses.
For retirees, you will need to show a minimum of €2,500 a month to live in Italy. Remember, this is a visa requirement rather than a calculated figure.
However, this amount of money will definitely provide you with a high quality of life and plenty of money to enjoy the many restaurants, bars, and cultural experiences you’ll inevitably find yourself surrounded by.
Buying property in Italy
If you’re buying property in Italy after Brexit, you can do so without first being a permanent resident. In fact, you’ll need proof of address for your residency application.
You can use this property as your holiday home until then, providing you follow the travel guidelines.
Buying property in Italy isn’t a particularly complicated process, although it’s obviously made more difficult with the potential language barrier. It’s best to find someone who can translate to help make things easier.
You’ll first need to find an estate agent, all of whom must be registered with their local chamber of commerce. If you can find one who speaks English, even better.
Also, you’ll need a notary, who closes the deal and seals the purchase contract. They also do all legal checks on the property.
In Itlay the real estate agent works on behalf of both buyer and seller. They conduct price negotiations and provide the notary with documentation once the price has been agreed upon.
The notary requires various documents, but the only ones you’ll need to provide are your forms of ID; the seller gives everything else.
Once this has been organised and a survey completed, the notary draws up the preliminary agreement. This is a legally binding contract and requires you to pay a 10% deposit.
After this, the notary will write up the final deed, which must be signed in front of them. You then transfer funds to the seller, and the property is yours!
Does the UK have a double taxation agreement with Italy?
The UK does have a double taxation agreement with Italy, even after Brexit. This means you won’t be taxed double on your income. Tax will only be calculated in your country of permanent residence.
Generally, this covers tax on income, although a lump-sum withdrawal of your UK pension will be taxed in Italy unless put in a QROPS. State pensions will still be taxed in the UK, as you can’t enter these into a QROPS.
Italian income tax is calculated on a progressive scale, and if you’re in Italy for fewer than 183 days in a 12-month period (which you usually will be), you’ll only be taxed on income earned in Italy.
Banking and bank accounts in Italy
You can open a non-resident bank account in Italy, which you might need for purchasing property or accessing money abroad. Non-resident bank accounts only allow deposits in imported currency.
You can either do this at a British branch of an Italian bank, or you can write a letter of authorisation allowing someone (such as your estate agent) to open an account on your behalf.
Once you live in Italy, you’ll be able to open a bank account very easily, even before becoming a full resident. You’ll need documentation, such as passport, proof of address, and residence card (if already a resident).
Healthcare in Italy
Italy’s national healthcare service offers high-standard, regional services.
You only have access to it once you become a permanent resident, and you’ll need to register with a local doctor to obtain your health card and number.
If you’re not working or paying social security contributions, you might have to pay an annual voluntary fee for access.
It’s current part of the residency application process to obtain private health insurance. There are certain specifications for the type and level of cover, and it’s best to get it through an international insurance provider.
Private cover gives you the option to choose your doctors and services, and you’ll have access to private hospitals. These are higher quality facilities with far shorter waiting times.
If you’re eligible for a UK-issued S1 form, you can get access to public healthcare facilities before becoming a resident. You still need to register with the local health authority to get your health card. You can visit the UK government’s website for more details.
Getting connected in Italy
Currently, three major companies dominate the mobile phone market in Italy: Wind Tre, Vodafone, and Telecom Italia.
It’s possible to get your mobile and internet services from the same company, which might be the easiest option when you first move there.
To register you’ll need proof of ID (passport, for example) and proof of address. It’s easiest to register in person at a store, and if you go to a larger town or city, it’s likely the staff will speak English.
It probably comes as no surprise that internet connection speeds can vary across the country. Italy was one of the first European nations to adopt the internet, but it’s potentially not progressed past this early stage in some areas.
Towns and cities will offer reasonably good broadband while smaller towns and villages, particularly in rural areas, are still on dial-up and ADSL.
If good internet is important, use Telecom Italia’s speed connection test. The company is the largest internet provider in the country.
Final thoughts on living in Italy
As you can see, living in Italy offers a lot of positives for anyone wanting a cultured yet relaxed retirement. Brexit shouldn’t get in your way because if you’re set on making Italy your new home, the restrictions won’t be difficult to overcome.
The only challenge, perhaps, is deciding where to live.
Unlike other countries where you can rent various places, Italy’s long-term rental leases mean this isn’t really an option. However, if you can find a way around this, you’ll be sure to find a place to call home.
You might find useful:
- The Best Places To Live In Italy For Expats
- The Expat Guide To UK Pensions Abroad: Understand Your Options
- Didn’t find what you were looking for or need further advice? Contact us with your question and we will do our best to help
Our free review explains how your pension and retirement income can be affected post Brexit. Understand how to protect and secure your residency and retirement income abroad.