Italian tax code for foreigners: what is and how to apply for

Introduction

Applying for a tax code is of fundamental importance for foreign citizens arriving in Italy who want to conclude a deal, such as the purchase or sale of a property.

In fact, in addition to its countless functions, the tax code must always be present in the notarial deed of purchase or sale of a property.

Requesting a tax code is a quick and simple procedure, but you need to pay close attention to it.

What is an Italian tax code?

The Italian tax code is a code made up of 16 alphanumeric characters that contains the applicant’s personal details, and is composed as follows:

– three letters relating to the surname

– three letters relating to the first name

– two digits relating to the year of birth

– one letter for the month (each month is assigned a letter in alphabetical order, for example the month of January is assigned the letter A, the month of February the letter B and so on)

– two digits to identify the day of birth, with the specification that in the case of a female subject, 40 is added to the number of the day of birth (for example, if the applicant was born on the 1st day of the month, the figure shown in the tax code will be 41)

– four characters relating to the municipality of birth or the country of origin

– the last character has a control function as it verifies the correctness of the tax code

The tax code, introduced in Italy in 1973, uniquely identifies a natural person and also non-natural persons when they have to interact with public administrations.

Why is it necessary to have an Italian tax code?

Foreign citizens who want to live in Italy must apply for a tax code, as it is essential for countless transactions such as opening a bank account, signing an employment contract, paying or claiming back taxes, or buying or selling a car.

In addition to these cases, the request for assignment of a tax code must always be made by a foreign citizen who wants to buy a property in Italy.

Why is it important to request a tax code before buying a property?

As mentioned above, the request for assignment and obtaining of a tax code by a foreign citizen who wants to buy a property in Italy is mandatory, according to various Italian regulations.

In the deed of purchase of a property, the insertion of the tax code serves several purposes. First of all, it uniquely identifies the parties (the seller and the buyer), avoiding errors that can arise from homonyms or variations in personal details.

Furthermore, the tax code is necessary for the fulfilment of the obligations of registration of the deed at the Revenue Agency and for the payment of the relative taxes (link taxes).

The tax code is also necessary for the registration of the property at the Land Registry and for the publication of the property at the relevant offices of the Land Registry, as well as for the updating of the Revenue Agency database.

Furthermore, the tax code, as a tool for traceability of the operations conducted by the owner, is of significant importance for tax monitoring and anti-money laundering.

What it does happen if two people have the same tax code

As mentioned above, the tax code is used for the unique identification of individuals, so what happens if two people have the same tax code?

In this case, the Revenue Agency replaces some characters to resolve the ambiguity.

How to apply for a tax code in Italy and the difference between EU and non-EU citizens

For EU citizens, the request for a tax code can be made by presenting form AA4/8 to a local office of the Revenue Agency, together with a valid identity document.

Non-EU citizens can obtain a tax code from a local office of the Revenue Agency by presenting form AA4/8, their passport and a suitable document for their stay in Italy.

What should foreign citizens who apply for an Italian tax code pay attention to?

Foreign citizens who ask me for help in obtaining an Italian tax code often tell me that they are concerned because the procedure is long and uncertain in their countries of origin.

In reality, requesting an Italian tax code is a quick and simple procedure if it is well managed.

Certainly, in the preparation of the documentation, attention must be paid to various factors, such as the presence of adequate motivation, the validity, even residual, of the documents, and the existence of a correct and suitable title of entry and permanence in Italian territory.

The timing for booking appointments is also quite fast, but even in this case it is useful to calculate it correctly so as not to risk arriving unprepared for the sale.

It is also essential to be precise in the information provided, as once the tax code has been assigned it identifies the person requesting it, and the variation procedure can be complex and vary from case to case.

Finally, to make applicants feel at ease, it may be useful to be accompanied to the office on the day of the request by someone who is able to communicate correctly with the officials.