Italian inheritance tax (imposta di successione) applies to assets located in Italy even when the heirs live abroad. Rates run from 4% to 8% depending on kinship, with exemptions up to €1 million per heir, and the succession declaration is due within 12 months of death.
What Is the Italian Inheritance Tax?
It is the tax the Italian state levies on the transfer of assets at death, reformed by Legislative Decree 139/2024 for deaths occurring from January 1, 2025. Liability does not follow the heir’s passport: it follows the residence of the deceased and the location of the assets.
If the deceased was resident in Italy, the worldwide estate is in scope. If the deceased lived abroad, only the assets located in Italy are taxed — typically a property, Italian bank accounts, or quotas in an Italian company. A US family inheriting a Tuscan villa from a parent who lived in New York owes Italian inheritance tax on the villa alone — a cornerstone of any international estate plan with Italian assets.
What Are the Rates and Exemptions in 2026?
Rates depend on the relationship between the deceased and each heir, and every exemption (franchigia) applies per heir, not per estate — the opposite of the US model, where the exemption attaches to the estate.
| Heir | Rate | Tax-free threshold (per heir) |
|---|---|---|
| Spouse and children (direct line) | 4% | €1,000,000 each |
| Siblings | 6% | €100,000 each |
| Other relatives to 4th degree; in-laws to 3rd | 6% | None |
| All other beneficiaries (incl. unmarried partners) | 8% | None |
| Heirs with severe disability (Law 104/1992) | Rate by kinship | €1,500,000 |
Two consequences matter in practice. Most direct-line successions of ordinary Italian homes produce little or no inheritance tax, because the taxable value rarely approaches €1 million per heir. And unmarried partners are taxed at 8% from the first euro — a real planning issue for international couples owning Italian property together.
How Is the Taxable Value Calculated?
For real estate, the base is not the market price but the cadastral value: the revalued cadastral income multiplied by a statutory coefficient, usually far below what the property would sell for. How that figure is built is explained in our guide to cadastral income in Italy.
Real estate transfers also trigger, regardless of any exemption:
- mortgage tax (imposta ipotecaria): 2% of the cadastral value, minimum €200;
- cadastral tax (imposta catastale): 1%, minimum €200;
- both drop to a fixed €200 each if at least one heir qualifies for the prima casa benefit.
Bank balances and securities follow their own rules, and some assets — notably Italian government bonds — are excluded from the taxable estate.
How Do Foreign Heirs File — and What Changed in 2025?
The succession declaration (dichiarazione di successione) must be filed electronically with the Revenue Agency within 12 months of death. Since the 2025 reform, the tax is self-assessed (autoliquidazione): heirs calculate and pay it when filing, instead of waiting for a bill. Faster for heirs abroad — but the responsibility for correct kinship categories, exemptions and valuations now rests on the heirs, and errors surface later as assessments with penalties.
From abroad, the file typically requires: an Italian tax code (codice fiscale) for each heir; the death certificate and any will, apostilled and translated where issued abroad; cadastral data of Italian properties and bank statements. None of it requires traveling: a power of attorney lets a representative run the entire process, as described in how to inherit property in Italy from abroad. Only after filing and land-registry recording can heirs sell or mortgage the assets — the sequence in transferring Italian property to heirs, and the reason late filings block estates in practice (see 7 steps to avoid probate delays).
What Mistakes Should Foreign Heirs Avoid?
- Assuming US or UK tax logic applies. Italy taxes per heir on kinship, on cadastral values — estimates built on market prices and estate-level exemptions are wrong in both directions.
- Missing the 12-month deadline. Penalties and interest accrue, banks keep accounts frozen, and properties cannot be sold.
- Ignoring double-taxation coordination. A 1955 treaty allocates US-Italy death taxes and the high US federal exemption shields most American estates; UK exposure depends on domicile. Check both systems before filing — which law governs the succession matters as much as the tax, as discussed in Italian inheritance law for US citizens.
- Accepting the inheritance by conduct. Taking possession of assets can be implied acceptance, with liability for estate debts. Where debts are possible, consider acceptance with benefit of inventory before touching anything.
Frequently Asked Questions About Italian Inheritance Tax
Do foreign heirs pay inheritance tax in Italy?
Yes, whenever the estate includes assets located in Italy or the deceased was Italian-resident. The heir’s nationality or residence neither creates nor removes liability: a US or UK heir pays under the same rates and per-heir exemptions as an Italian heir in the same kinship category.
Is the tax calculated on market value?
Not for real estate. The base is the cadastral value — revalued cadastral income times a statutory coefficient — typically well below market price. This is why many direct-line successions fall entirely within the €1 million per-heir exemption and pay only mortgage and cadastral taxes.
What is the deadline for the succession declaration?
Generally 12 months from the date of death, filed electronically with the Revenue Agency. Late filing triggers penalties, and in practice the Italian assets stay blocked: banks will not release funds and properties cannot be sold until the declaration is filed and recorded.
What changed with the 2025 reform?
For deaths from January 1, 2025, heirs self-assess: they calculate and pay the inheritance tax at filing, rather than receiving a bill from the Revenue Agency afterwards. The Agency audits later, so valuation and exemption errors become the heirs’ problem — professional review before submission is the safeguard.
Can I handle an Italian inheritance without traveling to Italy?
Yes. A power of attorney signed abroad — notarized, apostilled and translated — allows a representative to obtain tax codes, file the declaration, pay the taxes and execute the notarial deeds. Remote handling is standard for the international successions our office manages.
Will I also pay estate tax in the US or UK?
Often not, but verify. The 1955 US-Italy treaty coordinates the two systems and the high US federal exemption covers most estates; UK inheritance tax depends on the deceased’s domicile, with credit rules limiting overlap. A cross-border review before filing prevents paying twice — or missing a credit.
Conclusion
Italian inheritance tax is usually smaller than foreign heirs fear — kinship rates, per-heir exemptions and cadastral values see to that — but the procedure is unforgiving on deadlines, documents and the new self-assessment. Filed correctly once, the succession unlocks everything else: bank releases, land-registry transfers, an eventual sale. Our office handles the full chain remotely as part of its notarial services for international successions. Inheriting Italian assets from abroad? Book a preliminary consultation to verify values, exemptions and deadlines before you file.
Reviewed by Notary Nicola Giovanni Cerini, Italian civil-law notary assisting international clients with successions, real estate and corporate deeds. Sources: Legislative Decree 139/2024; Agenzia delle Entrate (succession declaration guidance); US-Italy Estate Tax Treaty (1955).