Moving to Italy: Costs Explained
At the heart of Europe, a two-hour flight away, Italy remains a place many dream about.
From beaches to charming hilltop towns surrounded by rolling hills of vineyards, to historic cities and cute villages, it’s got a bit of everything, but of course the lifestyle is irresistible, as is the architecture and the cuisine. In recent years, tax incentives have also attracted buyers and movers to Italy.
At one end of the financial spectrum, the country’s flat-tax regime has drawn HNWIs to relocate – mainly to Milan or other cities – even though the sum has increased from €100k a year to €300k. At the other, southern Italy has expanded the options for its 7% flat tax scheme that offers new movers who earn their income outside Italy – including retirees – the chance to save tax if they move to a town with fewer than 30,000 residents, in qualifying regions.
Finally, of course, there’s the one euro home scheme, which has been the most successful of its type in Europe, attracting around 1,400 buyers. We kick off with this option.
Cost to buy a home
Not everyone wants the bureaucracy and hassle involved with buying a property for €1, but it’s an option that remains popular, with around 400 homes being purchased this way in Sicily, where the scheme began in 2008.
A couple of caveats: you need to allow around €5,000 in legal/notary fees and at least €30,000 to renovate it, unless you are a builder and can do it all yourself. Which brings us to the fact that you can buy a property in much better shape for €40,000 in many areas of southern Italy – check out Abruzzo, Calabria, Puglia and Sicily as good hunting grounds. But most people tend to spend more: an average of £124k last year, according to searches on aplaceinthesun.com.
The top five for enquiries were a mix too: Tuscany’s Bagni di Lucca, Scalea (Calabria), San Siro (a small town in Lake Como), Cianciana (Sicily) and Vagli Sotto (Tuscany). Bear in mind there is a big disparity between the cost of northern Italy vs the south, but even around Lake Como in the more affluent north, there are pockets where you can still find a lovely little home for £100k.
Also bear in mind that if you decide to renovate, there are two types of bonus scheme available – one to those relocating (Bonus Ristrutturazioni) to another for those making eco-friendly improvements (the Eco Bonus). These offer tax reductions of 36-50%. Factor in buying costs of 7-10% on a home (there will be lower taxes on primary homes than holiday homes).
Cost to get a visa
Unless you have an EU passport - or a spouse with one – you will need to pay to get a visa. For the financially self-sufficient, including retirees in Italy, this means the Elective Residency Visa.
This has a higher income requirement than comparable visas in Spain, Portugal and France. A single individual requires a passive income of at least €31,000 per year; whilst for a couple it’s another 20%, so around €36,000 per year. Bear in mind that passive income might be pension, savings, buy to let income, as long as it is not earnt in Italy.
If you are under UK state pension age, you’ll also require private healthcare cover. There are also self-employment and digital nomad visas. For the latter, the minimum required to show is actually lower than the above - €28,000 per year. You apply to the Italian consulate in the UK.
Healthcare
You will need to factor in the cost of private healthcare cover initially if you under UK state pension age – this is a condition of the visa application. This might cost €1,000-€2,000 per year, depending on your age. After establishing residency in Italy, you can often buy into the public healthcare system (SNS - Servizio Sanitario Nazionale) for a low annual flat fee.
Those over UK state pension age can apply for an S1 Certificate from the NHS before they leave for Italy and this means that can use it when they register with the ASL Ufficio Estero (Foreign Office of the Local Health Authority) within Italian public health organisations that manages international healthcare for foreign nationals in Italy.
Cost of living
On average the cost of living in Italy is 20% lower than in the UK, but averages are only so useful. Obviously cities like London or Milan are much more expensive than provincial areas, and as with house prices, there is a big difference in living costs between north and south.
In Italy, the lower costs of living in the south have attracted many north Americans and Europeans to relocate, especially when combined with the affordability of the house prices as well as the 7% flat-tax regime (see below) in qualifying towns.
Rental rates are much lower than the UK in the smaller Italian cities of the north, as well as most of the south – the average UK premium is 60%, according to numbeo.com. Annual taxes tend to by much lower too – again, especially in the rural south. Retirees in Southern Italy can live comfortably on a budget of €1,500 to €2,000 per month, depending on their area and their lifestyle.
Taxes
As mentioned above, Italy offers several tax incentive schemes. In addition to the one aimed at HNWIs, and also one for returning Italians (Inbound Workers Regime) there is the 7% flat-tax incentive to move to southern Italy. This regime is available to new residents, for 10 years.
Until last month [April 2026] qualifying towns had to have fewer than 20,000 inhabitants but now it has been expanded to 30,000. Of over 70 new ‘flat tax’ municipalities there are many that are more and practical places to live, rather than small villages. There are mostly in Puglia, Sicily or Abruzzo, but also Calabria, Sardinia, Le Marche, Molise, Basilicata and Campania.
If you do not live in a qualifying town, then you will need to pay standard Italian income tax rates, which are somewhat higher. Put simply, this is 23% up to €28,999, then 33% up to €50,000, and 43% above €50,000, making wealthy retirees seriously consider towns like Ostuni (Puglia) or Sulmona (Abruzzo), that now qualify for the 7% regime.
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