Why Naples? Why Now?
There is a moment in every generation when a city reasserts itself on the world stage. For Naples — ancient, layered, improbable, magnificent — that moment is arriving in July 2027, when the Louis Vuitton 38th America's Cup will be sailed on the Gulf of Naples in the shadow of Vesuvius. It will be the first time in the history of the world's oldest international sporting competition that the America's Cup has been held in Italy, and for a city that has long been underestimated by the international financial community, it represents something rather more than a sailing regatta.
I have been advising ultra-high-net-worth individuals and their families on UK-Italy cross-border tax planning for the better part of four decades. I have watched the landscape change considerably over that time — through the introduction of the UK non-domicile regime's remittance basis rules, through various Italian tax reform programmes, and through the gradual emergence of Italy as a serious competitor to Switzerland, Monaco, and the United Arab Emirates as a preferred destination for internationally mobile wealth. What is happening now, in the spring of 2026, is qualitatively different from anything I have seen before. The confluence of the abolition of the UK non-domicile regime, the maturation of Italy's Article 24-bis flat-tax regime, and the coming of the America's Cup to Naples has created a window of opportunity for the right individual that will not remain open indefinitely.
This is the first in a series of seventeen advisory blogs that LEXeFISCAL will publish between now and July 2027 under the banner of the Road to Naples — a programme of in-depth analysis designed to equip internationally mobile individuals and their advisers with the authoritative technical grounding they need to evaluate Italy as a residence and investment destination. In this opening post, I want to address the foundational question: why Naples, why Italy, and why now?
The End of an Era: The Abolition of the UK Non-Domicile Regime
It is impossible to begin any serious discussion of Italian residence planning in 2026 without acknowledging what happened on 6 April 2025. On that date, the United Kingdom's non-domicile regime — a fiscal framework that had in various forms provided relief for foreign-source income and gains of non-UK domiciliaries for well over a century — was abolished and replaced by a new Foreign Income and Gains (FIG) regime. The FIG regime provides a four-year exemption from UK tax on foreign income and gains for new arrivals to the UK, after which such income and gains are fully taxable in the United Kingdom on the arising basis, without relief for remittance or domicile status.
For the individual who had relied on the remittance basis — particularly those who had been UK resident for ten, fifteen, or twenty years and had accumulated substantial overseas wealth sheltered by their non-UK domicile status — the change is profound. The FIG regime offers no transitional relief that compares with the protection that long-standing non-doms enjoyed. For those at the top of the wealth scale, the combined UK income tax and capital gains tax burden on overseas income and gains arising after 5 April 2025 is, in many cases, existential in its financial impact.
The result has been exactly what many practitioners predicted, and what the Government of the day appeared either to discount or to accept: a significant wave of residence reviews among ultra-high-net-worth individuals, many of whom have spent decades in the United Kingdom and have strong personal, professional, and cultural ties to this country. These are not individuals who leave lightly. But the mathematics, for those with overseas income significantly exceeding seven figures per annum, is now very difficult to ignore.
Italy's Flat-Tax Regime: The Article 24-bis TUIR Framework
Italy's response to this global competition for internationally mobile wealth was legislated in 2017 through the introduction of Article 24-bis of the Testo Unico delle Imposte sui Redditi (TUIR — Decreto del Presidente della Repubblica 22 dicembre 1986, n. 917), subsequently amended on two significant occasions. The regime is elegant in its simplicity and, even after successive increases, remains extraordinary in its generosity to those who qualify.
The core proposition is this: an individual who has not been resident in Italy for tax purposes in at least nine of the ten tax years preceding their transfer of residence to Italy may elect, upon becoming Italian resident, to pay a fixed annual imposta sostitutiva (substitute tax) on all foreign-source income and gains, regardless of their quantum. The charge is not a rate — it is a flat sum. Under the 2026 Budget Law (Legge di Bilancio 2026), approved on 30 December 2025, that flat sum currently stands at €300,000 per annum for new elections made from 1 January 2026 — an increase from the €200,000 rate that applied between August 2024 and December 2025, which was itself double the original €100,000 charge that applied from the regime's introduction in 2017 until August 2024. The regime applies for a period of up to fifteen years. Italy has respected the grandfathering principle throughout each increase: those who established Italian tax residence and validly entered the regime under a prior rate continue to pay that lower rate for the remainder of their fifteen-year period.
The financial arithmetic, for an individual with substantial overseas income, continues to speak for itself notwithstanding the successive increases. A UK income tax and National Insurance burden that might realistically reach 47% on employment income above £125,140, or 28% on residential property capital gains, or 39.35% on dividend income exceeding the basic rate band, is replaced — entirely in respect of foreign-source receipts — by a flat annual charge of €300,000, which at current exchange rates represents approximately £255,000. For an individual with overseas income of £2 million per annum, the annual saving in moving from UK tax on the arising basis to the Italian flat-tax regime remains of the order of £685,000 per annum. Over fifteen years, the cumulative benefit before investment returns on the saving is approximately £10.3 million. These are still remarkable numbers, even at the revised rate.
The regime extends to dependent family members. Under the 2026 Budget Law, the supplementary charge for each qualifying family member has also increased, from €25,000 to €50,000 per annum per person, with no limit on the number of family members who may participate. A family of four, with three family members joining the election, now pays a total annual charge of €450,000 on the entirety of their family's foreign-source income and gains. The planning implications require careful evaluation, particularly where family income is concentrated in one individual and the aggregate foreign income is very substantial.
It is important to be precise about what the regime does and does not cover. The €300,000 flat charge applies only to foreign-source income and gains. Italian-source income — income arising from Italian employment, Italian business activities, Italian rental property, Italian investments — remains subject to normal Italian progressive income tax (IRPEF — Imposta sul Reddito delle Persone Fisiche) at rates currently rising to 43% on income above €50,000. The planning corollary is that Italian-resident flat-tax individuals should, where possible, structure their affairs so that active economic activity — to the extent any is undertaken — is conducted outside Italy, or through Italian vehicles whose income is sheltered by the applicable Italian tax treatment. This is a matter on which detailed advice is essential, and one to which I shall return in subsequent posts in this series.
A further point of particular relevance to those currently considering a move is the continued attractiveness of the regime at the new rate. Italy ranked as the third most popular destination for millionaire migration globally in 2025 — after the original doubling of the rate to €200,000 had already taken effect. The evidence to date is that the successive increases have not materially dampened demand. The profile of individual for whom the regime represents a compelling opportunity has, however, narrowed: it is most powerfully suited to the individual with very substantial foreign income, for whom the absolute saving over fifteen years dwarfs the increased annual charge.
The Road to Naples: Why the America's Cup Changes Everything
The Louis Vuitton 38th America's Cup Match will open on 10 July 2027 in the Gulf of Naples. The preliminary regattas are already underway, with the first having been held in Cagliari, Sardinia, in May 2026. Naples itself has been named European Capital of Sport 2026, placing the city under sustained international media attention for the entirety of this year and the next.
I am not in the business of selling cities. Naples does not need my endorsement. But I will say this: in forty years of advising internationally mobile individuals on their residence decisions, I have observed a consistent pattern. The individuals who are most content with their decision to leave the United Kingdom and establish themselves elsewhere are those who find, in their new home, not merely a favourable tax environment but a quality of life, a cultural richness, and a social community that gives the decision a positive rather than a merely defensive character. Italy, and Naples in particular, offers that in abundance.
The America's Cup is bringing to Naples an international community of precisely the kind of individuals — successful, internationally mobile, discerning, and accustomed to excellence — who represent both the potential new residents and the potential investors that the Campania region is actively courting. The Italian Government's commitment to the Bagnoli waterfront regeneration project, the substantial public and private investment in Naples's infrastructure and hospitality sector ahead of the Cup, and the institutional endorsement of the city by the Italian Minister for Sport and Youth, the President of the Campania Region, and the Mayor of Naples all speak to a city that is not merely hosting an event but positioning itself deliberately as an international destination of the first rank.
What the Road to Naples Programme Will Cover
Over the next fourteen months, this blog series will provide the most comprehensive English-language guide to UK-Italy tax planning that LEXeFISCAL has published. It is addressed both to the individual considering Italian residence and to the professional adviser — the private banker, the family office executive, the English-law solicitor, the accountant — who needs to understand the Italian fiscal landscape well enough to guide their client through it.
The subjects we will address include: a full technical analysis of the Article 24-bis TUIR flat-tax regime, including the qualifying conditions, the election mechanics, the treatment of capital gains, and the critical interaction with the UK-Italy Double Taxation Convention of 1988; the practical mechanics of UK exit planning under the Statutory Residence Test — the conditions that must be satisfied, the timing traps that catch the unwary, and the treatment of employment income and carried interest in the year of departure; Italian succession law and the forced heirship provisions of the Codice Civile, and how they interact with the English law will-drafting that most UK residents have in place; the acquisition of Italian property — the imposta di registro, the IVA position on new builds, the IMU and TASI regime, and the IVIE wealth tax on Italian property held by non-residents; Italian trust law and its recognition under the Hague Convention; the ZES unica del Mezzogiorno incentive framework for investment in southern Italy; and the comparative analysis of Italy against the competing residence regimes of Greece, Portugal, and Malta.
This is material that matters. It is not published for entertainment. It is published because the decisions that internationally mobile individuals are currently making — decisions that will determine where they and their families live, where their wealth is managed, and how it passes to the next generation — are among the most consequential they will ever make. They deserve to be made with the best available information.
A Personal Note
I want to conclude this opening post with something that goes beyond the technical. I have, over the years, observed the damage that poorly planned or precipitate emigration decisions cause — not merely financially, but to the individual and their family. The UK non-domicile regime, whatever its fiscal limitations in its final form, provided a degree of stability for the internationally mobile individual that its abolition has removed. The individual who leaves the United Kingdom in 2026 without a properly structured departure strategy — without a careful analysis of the Statutory Residence Test conditions, without a review of their offshore trusts and companies in light of the new FIG rules, without proper succession planning across two legal systems, and without a realistic assessment of the Italian tax position they are entering — is taking risks that are entirely unnecessary and potentially very costly.
The purpose of LEXeFISCAL's Road to Naples programme is not to encourage departure from the United Kingdom for its own sake. It is to ensure that those who are genuinely considering a move to Italy do so with their eyes open, their affairs properly ordered, and their decisions grounded in technical reality rather than financial mythology. Italy's flat-tax regime is a genuinely exceptional planning opportunity. It is also a complex one, with traps for the unwary and conditions that require careful professional management. The blog posts that follow are designed to illuminate both the opportunity and the hazards with equal candour.
The America's Cup comes to Naples in July 2027. The road to that moment begins now.
Vincit Veritas.
Dr Clifford Frank
LLM(Tax), PhD, HDipICA, ATT | Senior Partner, LEXeFISCAL LLP
33 Cavendish Square, London W1G 0PW
If you are currently reviewing your UK tax residence or evaluating Italy as a residence or investment destination, LEXeFISCAL would be pleased to assist. Please contact us at 33 Cavendish Square, London W1G 0PW or visit www.lexefiscal.com to arrange a consultation.
This blog post is for general information purposes only. It does not constitute legal or tax advice and should not be relied upon without seeking professional advice tailored to your specific circumstances. Tax law is complex and constantly evolving. Each person's situation is unique. LEXeFISCAL LLP is regulated by the Institute of Chartered Accountants in England and Wales (ICAEW). LEXeFISCAL LLP is not a firm of solicitors and is not regulated by the Solicitors Regulation Authority. © LEXeFISCAL LLP 2026. All rights reserved.
