Italy Capital Gains Tax: A Comprehensive Guide

Italy's capital gains tax (imposta sulle plusvalenze) applies to profits from selling shares, bonds, ETFs, crypto-assets, and real estate. The rules differ significantly depending on whether you are an individual or a corporation, a resident or a non-resident, and whether the 2026 Budget Law's new thresholds affect your holdings. This guide breaks down what you owe, when you owe it, and what exemptions you can claim.

Standard Rates for Individuals

For individuals, the default rate on most financial capital gains is a flat 26% substitute tax. This applies to:

• Sales of shares, bonds, and ETFs
• Non-qualified shareholdings (less than 20–25% of a company's capital or voting rights)
• Gains typically withheld by Italian financial intermediaries or self-reported on your tax return

Italian government bonds benefit from a reduced rate of 12.5%. Certain regulated investment funds and specific dividend structures may qualify for different treatment.

Crypto-Assets: New 33% Rate from 2026

Starting January 1, 2026, capital gains on crypto-assets are taxed at 33%, up from the previous 26% rate. This applies to all disposals of digital assets including cryptocurrency, tokens, and NFTs. The increase is part of the 2026 Budget Law's broader revenue measures targeting digital holdings.

Calculating the Gain

The taxable gain is straightforward: sale price minus purchase cost, minus deductible transaction fees (notarial costs, broker commissions), minus any qualifying prior-year losses carried forward. For assets acquired before 2019, transitional rules previously allowed partial inclusion in progressive IRPEF bands, but the 26% flat rate is now the standard regime.

Payment Schedule

Italy uses an advance payment system for capital gains tax:

• 40% of the prior year's liability is due by June 30
• The remaining 60% is due by November 30

This schedule applies when you self-report gains rather than having them withheld by an intermediary. For a full overview of Italian tax deadlines, see our annual filing guide.

Significant Shareholdings

If you hold a qualified participation (20% or more of voting rights, or 25% or more of capital in unlisted companies), the taxation changes. Instead of the 26% flat rate, 49.72% of the gain is included in your personal income and taxed at progressive IRPEF rates ranging from 23% to 43%.

This distinction matters for founders, early investors, and anyone holding substantial stakes in Italian companies. The threshold is measured at the time of sale, not at the time of acquisition.

Corporate Taxation and the Participation Exemption (PEX)

Corporations pay capital gains tax at the combined corporate rate: 24% IRES (Imposta sul Reddito delle Società) plus 3.9% IRAP (regional tax), totaling roughly 27.9%.

However, the Participation Exemption (Partecipazione Esente, or PEX) can exempt 95% of gains from qualifying share disposals, reducing the effective tax to approximately 1.2%.

2026 PEX Threshold Changes

From January 1, 2026, the PEX regime requires the participation to meet one of two conditions:

• At least 5% of the share capital or voting rights, or
• A value of at least €500,000

These thresholds apply to participations acquired from January 1, 2026 onward. Pre-existing holdings remain under the previous rules. The change aligns PEX eligibility with the tightened dividend exclusion thresholds and focuses the benefit on more substantial corporate investments.

Real Estate Capital Gains

The rules for selling property in Italy operate on a different set of principles:

When Tax Applies

A flat 26% substitute tax applies when you sell a property within 5 years of purchase and the property has not been your primary residence (prima casa) for at least half the ownership period.

When You Are Exempt

• You have owned the property for more than 5 years
• The property served as your principal residence for more than 50% of the time you owned it
• The property was inherited (inherited properties are not subject to capital gains tax)

Corporate and Non-Resident Sellers

Companies selling Italian real estate pay capital gains tax at the corporate rate of approximately 27.9% (IRES + IRAP). Non-residents selling Italian property—whether directly or through an indirect holding structure—are generally taxed in the same manner as Italian residents following regulatory updates introduced after 2023.

For a detailed breakdown of property-specific taxes, deductions, and notary costs, see our complete tax guide for foreign property buyers and sellers.

2026 Budget Law: Key Changes

The 2026 Budget Law (Legge di Bilancio 2026) introduces several changes that affect capital gains taxation:

Change	Detail
PEX thresholds	95% exemption now requires stakes of at least 5% or valued at €500,000 (acquisitions from January 1, 2026)
Crypto-asset rate	Substitute tax rises from 26% to 33%
Dividend alignment	Large dividend distributions follow the new PEX participation thresholds for the 95% exclusion
Tobin Tax increase	Proportional rates for the Italian Financial Transaction Tax (IFTT) doubled for relevant trading activity

These measures target revenue from larger holdings, digital assets, and substantial cross-border transactions while preserving preferential treatment for genuine long-term property and business investment.

Exemptions, Reliefs, and Special Regimes

Full Exemptions

• Real estate held for more than 5 years
• Inherited property disposals
• Corporate gains qualifying under PEX
• Certain regulated investment fund structures

Lump-Sum Tax for New Residents

Individuals who relocate to Italy can opt for a fixed substitute tax covering all foreign-source income, including capital gains. From 2026, this lump-sum amount increases to €300,000 per year. This regime is primarily designed for high-net-worth individuals transferring their tax residence to Italy.

Loss Offsetting

Capital losses from one tax year can be carried forward and offset against future capital gains of the same category. Losses must be documented and reported in the relevant sections of the Italian tax return. Italian intermediaries typically track this automatically for managed accounts; self-reporting taxpayers must maintain their own records.

Reporting and Filing

How you report capital gains depends on your situation:

• Through an intermediary: Italian banks and brokers withhold the 26% substitute tax at source for most financial transactions. No further action is required on your part for those gains.
• Self-reporting: If you hold foreign investments, use a non-Italian broker, or sell real estate privately, you must report gains in sections RW, RL, or RM of the Modello Redditi tax return.

For residents with worldwide investment income, all foreign-source capital gains must be declared regardless of whether the income was already taxed abroad. Tax credits under applicable double taxation treaties can prevent you from paying twice on the same gain.

Non-residents with Italian-source capital gains should review the specific filing obligations for non-residents to determine what must be declared and which forms apply.

Filing Made Easier with ItalianTaxes.com

Italy's capital gains tax system has grown more intricate with the 2026 updates—new crypto rates, tightened PEX thresholds, and adjusted Financial Transaction Tax rates all require careful attention. Rather than navigating cross-border rules, digital forms, and shifting legislation alone, you can streamline compliance using ItalianTaxes.com. Our technology-driven platform enables you to file, calculate, and pay Italian capital gains tax online—quickly, securely, and in fluent English.

Ready to file your Italian capital gains tax? Get started with ItalianTaxes.com today.