It is relevant to highlight the importance of the new guidelines for international estate planning and investment in Italy. The novelty is that the guidelines are not limited solely to trusts; it is worth noting the benefits of the new rules when applied to relocation to Italy, given the many special tax regimes in force, such as the new tax residents (NTR) regime.[2]

For existing and prospective settlors or beneficiaries of international trusts or foundations who are considering relocating to Italy, there is now room to shape the wealth architecture in full tax and legal compliance. The set-up of an international discretionary trust with retained powers,[3] before or after the relocation, is a key feature to be considered, depending on the jurisdictions involved.

In Italy, the combination is relevant for ultra-high-net-worth (UHNW) individuals and families. Italy is no stranger to the application of trusts, both from a legal and fiscal perspective, having signed the Hague Convention of 1 July 1985 on the Law Applicable to Trusts and on their Recognition and having now issued clear guidelines via its tax authorities.

Moreover, an appealing alternative that does not consider relocation to Italy consists of setting up an international or domestic trust, governed by foreign law, to invest in real estate or trophy assets in Italy. In this case, as an example, the transfer of foreign assets by the prospective settlor to the Italian trust is subject only to a EUR200 registration tax plus a EUR50 cadastral and mortgage tax.