Studio BCZ – Rome | Updated 19 October 2026

Italy’s 7% flat substitute tax for new resident pensioners under Article 24-ter TUIR also applies to heirs who inherit a foreign pension plan. A new Italian Tax Authority ruling (no. 184/2026, 15 October 2026) confirms that an heir stepping into a deceased parent’s US IRA can still access the regime on the resulting distributions.

The Article 24-ter Regime in brief

• 7% flat tax on all foreign-source income, for up to 9 tax years
• Available to new residents of qualifying municipalities in Sicily, Calabria, Sardinia, Campania, Basilicata, Abruzzo, Molise, Puglia, and designated earthquake-affected areas (population ≤ 30,000)
• Requires 5 years of prior non-residence in Italy and relocation from a country with an administrative cooperation agreement with Italy
• Waives the individual from tax monitoring rules (Form RW) and from inheritance & gift tax

See our earlier article on the extension to more Southern municipalities.

What the Italian Tax Authority decided

An Italian citizen who inherited her late father’s US IRA — funded through his voluntary contributions — asked whether the resulting distributions qualify as foreign pension income under Article 49(2)(a) TUIR, and whether she, as heir rather than original holder, could use the 7% regime once she relocates to Italy in 2027. The Tax Authority answered yes on both counts:

• Pension character is safeguarded. Voluntary contributions by the deceased do not disqualify the income from qualifying as “pension income” (Circular 21/E/2020; Rulings 21/2024 and 290/2025).
• The heir steps into the same tax treatment. Under Article 7(3) TUIR, income accruing to heirs is taxed exactly as it would have been for the deceased. The heir may therefore opt for the 7% regime starting from the year she becomes an Italian tax resident.

Why it matters

• Inheriting a foreign pension does not break eligibility for the 7% regime
• Voluntarily-funded foreign retirement accounts (IRAs, 401(k)s and similar vehicles) qualify
• The reasoning should extend to comparable inherited arrangements from other countries, on a case-by-case basis

Points to verify before relying on this Ruling

• That the foreign instrument genuinely qualifies as a pension under its governing law
• That all other Article 24-ter conditions are independently met
• Treaty relief (e.g., the Italy–US treaty) to avoid double taxation on the same distributions
• Italian inheritance tax exposure on the underlying capital — a separate question from the income tax treatment

Frequently Asked Questions

Can an heir access Italy’s 7% flat tax on an inherited foreign pension? Yes. Ruling no. 184/2026 confirms that heirs inherit not only the asset but its tax character, so Article 24-ter remains available to them.

Does it matter if the foreign pension was funded with voluntary contributions? No. The Italian Tax Authority has repeatedly held that voluntary contributions do not prevent a foreign account from being considered a pension under Italian tax law.

Does this ruling apply only to US IRAs? The ruling concerns a US IRA, but its legal basis — Articles 7 and 49 TUIR — is of general application and should extend to comparable foreign pension arrangements, subject to case-by-case review.

Talk to Studio BCZ

We advise internationally mobile individuals and families on relocation to Italy and access to Article 24-ter and other special tax regimes, including for inherited foreign pensions and retirement accounts. Contact us at info@studiobcz.it for a preliminary assessment.