Italian inheritance law for foreigners can be complex and unfamiliar, especially when inheriting property or other assets in Italy as a foreign heir. Italian succession law has its own rules on who inherits, in what proportions, and what taxes apply, rules that may differ significantly from those of the heir’s home country.
This guide explains the key principles of Italian inheritance law, the important changes introduced by EU Regulation 650/2012, the Italian inheritance tax regime, and the practical steps involved in managing an Italian estate from abroad.
It is also relevant for anyone, Italian or foreign, who owns property in Italy and wishes to plan their estate in advance, whether through a will or other instruments.
Which Law Governs an Italian Inheritance?
The starting point for any cross-border inheritance involving Italy is EU Regulation No. 650/2012 on succession matters, which has applied in all EU member states, except Denmark and Ireland, since 17 August 2015.
Under this Regulation, the law applicable to a succession is, as a general rule, the law of the country where the deceased was habitually resident at the time of death. This is a significant change from the previous Italian rule, which applied Italian law to Italian citizens regardless of where they lived.
Three practical examples illustrate how this works. A British national who was habitually resident in Italy at the time of death: Italian succession law applies to their entire estate, including UK assets, subject to certain limitations in third countries. An Italian national who was habitually resident in the UK: English law applies to the succession as a general rule. A foreign national habitually resident in their home country who owned a property in Italy: the law of their home country generally governs the succession, but Italian inheritance tax and procedural requirements still apply to the Italian assets.
The professio iuris: choosing the applicable law
EU Regulation 650/2012 allows a person to choose, in their will, that the law of their nationality should govern their succession instead of the law of their habitual residence. This choice, known as professio iuris, can be a powerful estate planning tool, particularly for Italian nationals living abroad or foreign nationals with significant assets in Italy. It must be made explicitly in a valid will.
Italian Succession Law: The Key Principles
When Italian law governs the succession, the following principles apply.
Testate succession: succession with a valid will
If the deceased left a valid will, that will determines how the estate is distributed, but only to the extent permitted by law. Italian law imposes mandatory reserved shares (quote di legittima) for certain close relatives, which cannot be overridden by a will.
Under Italian law, a will must take one of three forms. The holographic will (testamento olografo) is written entirely by hand, dated, and signed by the testator. No witnesses or notary are required, but the document must meet strict formal requirements. The public will (testamento pubblico) involves a notary and two witnesses. It is the most secure form, and is strongly recommended for complex estates or cross-border situations. The secret will (testamento segreto) is a less common form. The testator delivers it to a notary in a sealed envelope.
Intestate succession: no valid will
If the deceased left no valid will, Italian law establishes the order of succession. The estate passes in the following order of priority:
| Priority | Heirs | Share |
|---|---|---|
| 1st | Spouse and/or children | Varies, see reserved shares below |
| 2nd | Ascendants (parents, grandparents) and siblings | If no children survive |
| 3rd | Other collateral relatives (up to 6th degree) | If no closer relatives survive |
| Last | Italian State | If no relatives survive |
Reserved shares (quote di legittima)
Italian law reserves a mandatory portion of the estate for certain close relatives (legittimari), regardless of what the will says. These reserved shares cannot be reduced by the testator’s dispositions:
| Heirs entitled to reserved share | Minimum reserved share |
|---|---|
| Spouse only (no children) | 1/2 of estate |
| One child only (no spouse) | 1/2 of estate |
| Two or more children (no spouse) | 2/3 of estate (shared equally) |
| Spouse and one child | 1/4 (spouse) + 1/4 (child) = 1/2 total |
| Spouse and two or more children | 1/4 (spouse) + 1/3 (children equally) = 7/12 total |
| Parents only (no spouse, no children) | 1/3 of estate |
If the will infringes these reserved shares, for example by leaving everything to a third party, the prejudiced heirs can bring an action for reduction (azione di riduzione) within ten years of the opening of the succession. This is an important consideration for anyone purchasing property in Italy that was previously received as a gift or by inheritance.
Italian Inheritance Tax (Imposta di Successione)
Italian inheritance tax applies to estates that include assets located in Italy, regardless of where the heirs reside. If the deceased was resident in Italy at the time of death, the tax applies to their worldwide assets. If the deceased was resident abroad, the tax applies only to assets located in Italy.
The rates and tax-free allowances are as follows:
| Relationship to deceased | Tax rate | Tax-free allowance |
|---|---|---|
| Spouse or civil partner | 4% | €1,000,000 per heir |
| Children and direct descendants | 4% | €1,000,000 per heir |
| Parents and direct ascendants | 4% | €1,000,000 per heir |
| Siblings | 6% | €100,000 per heir |
| Other relatives up to 4th degree | 6% | No allowance |
| All other persons | 8% | No allowance |
| Heirs with severe disabilities | 4% / 6% / 8% | Additional €1,500,000 allowance |
For real estate specifically, Italian law calculates the inheritance tax on the cadastral value of the property, not the market value, which significantly reduces the effective tax burden. In addition to inheritance tax, the transfer of real estate through succession also carries a fixed mortgage tax (imposta ipotecaria) of €200 and a fixed cadastral tax (imposta catastale) of €200.
The Succession Declaration (Dichiarazione di Successione)
When a person dies leaving assets in Italy, heirs must file a succession declaration (dichiarazione di successione) with the Italian Revenue Agency (Agenzia delle Entrate) within 12 months of the date of death.
The declaration must list all assets forming part of the estate located in Italy, real estate, bank accounts, vehicles, company shares, and other movable assets, along with their value. The Revenue Agency uses this declaration to calculate the inheritance tax due.
For foreign heirs, filing the succession declaration from abroad requires several documents. Each heir needs an Italian tax code (codice fiscale), obtainable from the Italian consulate in their country of residence. Heirs also need a certified copy of the death certificate, apostilled if issued outside Italy, and a copy of the will, if any, authenticated and translated into Italian if issued abroad. Finally, they must provide a list and valuation of all Italian assets, and appoint an Italian lawyer or representative to act on their behalf.
Late filing attracts penalties. If heirs do not file the declaration at all, the Revenue Agency can reconstruct the estate and assess the tax ex officio, with additional penalties and interest. Foreign heirs who are unaware of their obligations, or who discover the Italian assets only years after the death, should take legal advice promptly.
Accepting or Renouncing the Inheritance
Under Italian law, an heir does not automatically inherit: they must either accept or renounce the succession. This choice has important consequences.
Simple acceptance (accettazione pura e semplice)
The heir accepts the entire estate, including all debts. If the debts exceed the assets, the heir becomes personally liable for the difference. This can be a serious risk when the estate is unknown or potentially insolvent.
Acceptance with benefit of inventory (accettazione con beneficio d’inventario)
The heir accepts the succession but limits their liability for debts to the value of the inherited assets. This is the recommended option when the extent of the deceased’s debts is uncertain. It requires a formal declaration before a notary or court within three months of the heir becoming aware of the succession.
Renunciation (rinuncia all’eredità)
The heir formally declines the succession. They receive nothing but also assume no liability for debts. The heir must make the renunciation before a notary or court, and it takes retroactive effect from the date of death. Once made, the heir cannot revoke it.
Estate Planning: Making a Will for Italian Assets
Anyone who owns property or other significant assets in Italy, whether resident or not, is strongly advised to make a will that specifically addresses their Italian assets. Without a will, Italian intestate succession rules determine how the estate is divided, which may not reflect the owner’s wishes and can create significant complications for heirs.
There are several key considerations for estate planning with Italian assets. Consider making a separate Italian will (testamento) in addition to any will made in your home country, to avoid conflicts between the two documents and reduce the risk of the Italian will being challenged on formal grounds.
Consider making a professio iuris in the will, choosing the law of your nationality to govern your succession, particularly useful if the rules of that law are more flexible than Italian law on reserved shares. Be aware that forced heirs can challenge donations made during the lifetime of the deceased (azione di riduzione) if they reduce the reserved shares; this applies to gifts of Italian real estate regardless of when they were made. Finally, non-married partners, including civil partners in some jurisdictions, do not have the same succession rights as spouses under Italian law, so specific provisions in a will are essential to protect a partner’s position.
Practical Steps for Foreign Heirs with Italian Assets
Foreign heirs managing an Italian estate should follow a clear sequence. Obtain an Italian tax code (codice fiscale) for each heir as a first step, since this is required for almost every administrative and legal action in Italy. Engage an Italian lawyer with experience in cross-border succession matters to act on behalf of the heirs in Italy. Identify and value all Italian assets: real estate via a land registry search, bank accounts, vehicles, and company interests. Obtain and authenticate all required documents: death certificate, will if any, and kinship certificates.
File the succession declaration with the Revenue Agency within 12 months of the death, and pay the inheritance taxes due, either in a lump sum or in instalments as permitted by law. Complete the transfer of real estate into the heirs’ names by filing the appropriate transcription at the land registry (voltura catastale and trascrizione). Finally, decide whether to retain, sell, or rent out any inherited Italian property, since each option has different tax implications that should be considered with legal and tax advice.
Are You a Foreign Heir Dealing with an Italian Estate?
Magaraggia Law Firm assists international clients with all aspects of Italian succession and inheritance: from filing the succession declaration and paying inheritance taxes, to managing and transferring Italian real estate. Beyond succession matters, we also assist clients who wish to purchase property in Italy, managing the entire transaction on their behalf, from the initial legal due diligence, to negotiating with the seller and the estate agent, to coordinating with the notary through to completion. Our objective is always the same: to protect our client’s interests at every step and to eliminate legal and financial risk as far as possible. We advise in English, French and Spanish, and assist clients remotely from any country.
Whether you are dealing with an Italian estate or planning ahead as a property owner, contact us for a free initial consultation:
info@studiolegalemagaraggia.it
+39 328 071 0278