If you've sold property, stocks, or other assets in Italy, you'll likely need to file a capital gains tax return in Italy — and understanding the process can save you from costly penalties and missed deductions. Whether you're an Italian resident, an expat living in Rome or Milan, or a non-resident with Italian investments, this Italy tax filing guide will walk you through every step for the 2025/2026 tax year.

Italy's tax system can be complex, with different rules for different asset classes, varying rates for residents and non-residents, and specific forms that must be completed correctly. In this guide, we'll break down everything you need to know about how to file taxes in Italy related to capital gains — from identifying taxable events and calculating your liability to submitting your return on time.

Before we dive in, you can quickly estimate your potential tax bill using our Italy Capital Gains Tax Calculator.

What Is Capital Gains Tax in Italy?

Capital gains tax in Italy — known as imposta sulle plusvalenze — is levied on the profit you make when you sell or dispose of certain assets for more than you paid for them. The Italian tax code distinguishes between several categories of capital gains, and the applicable tax treatment depends on the type of asset, how long you held it, and your residency status.

Taxable Events That Trigger Capital Gains

The following transactions can generate a taxable capital gain in Italy:

  • Sale of real estate (property held for less than five years, or within five years of construction/renovation)
  • Sale of shares and equity investments (both listed and unlisted companies)
  • Sale of bonds and other financial instruments
  • Disposal of business assets
  • Sale of intellectual property or rights
  • Cryptocurrency disposals (digital assets are now explicitly regulated)

Note that for real estate, if you've owned the property for more than five years and it has been your primary residence (prima casa) for the majority of that period, the gain is generally exempt from capital gains tax.

Who Needs to File?

You need to report capital gains and file a return if you are:

  • An Italian tax resident who sold assets generating a capital gain during the tax year
  • A non-resident who realized gains from the sale of Italian real estate or a significant (qualified) holding in an Italian company
  • An individual who received gains that were not already taxed at source through the regime del risparmio amministrato (managed savings regime)

Understanding Italy's Capital Gains Tax Rates for 2025/2026

Italy applies different tax rates depending on the type of asset and the taxpayer's chosen tax regime. Here's what you need to know for the current tax year:

Financial Assets (Shares, Bonds, Funds)

For most financial capital gains, Italy applies a flat substitute tax (imposta sostitutiva) of 26%. This applies to:

  • Gains from listed and unlisted shares
  • Gains from investment funds
  • Gains from bonds issued by private entities
  • Gains from cryptocurrency and digital assets

However, gains from Italian government bonds (such as BOTs and BTPs) and bonds issued by EU/EEA member states on Italy's approved list are taxed at a reduced rate of 12.5%.

Real Estate Capital Gains

When you sell property held for fewer than five years, you have two options:

  1. Include the gain in your ordinary income — taxed at progressive IRPEF rates ranging from 23% to 43%
  2. Opt for the substitute tax — a flat rate of 26% applied at the time of the notarial deed

If the property was your primary residence for the majority of the ownership period, the gain is fully exempt.

Qualified Participations

Since the 2019 reform, gains from both qualified and non-qualified participations are generally subject to the 26% flat substitute tax, simplifying what was previously a more complex regime.

Example: If you purchased shares in an Italian company for EUR 30,000 and sold them for EUR 50,000, your capital gain is EUR 20,000. At the 26% substitute tax rate, your capital gains tax liability would be EUR 5,200. Use our Italy Capital Gains Tax Calculator to run your own scenario.

Step-by-Step: How to File Your Capital Gains Tax Return in Italy

Now let's get to the core of this guide. Here's your step-by-step walkthrough for filing your capital gains tax return in Italy for the 2025/2026 tax year.

Step 1: Determine Your Tax Regime

Before filing, you need to understand which tax regime applies to your financial gains. Italy offers three regimes for financial investments:

  • Regime della dichiarazione (Declaration regime): You calculate and report gains yourself on your annual tax return. This is the default regime.
  • Regime del risparmio amministrato (Managed savings regime): Your Italian financial intermediary (bank or broker) calculates and withholds the tax on each transaction. No further filing is required for those gains.
  • Regime del risparmio gestito (Managed portfolio regime): A portfolio manager calculates and pays the tax on the overall annual result of the portfolio.

If your gains were handled under the amministrato or gestito regime, the tax has already been withheld, and you typically do not need to report those specific gains on your return. However, if you're in the dichiarazione regime — common for those using foreign brokers or managing investments directly — you must file.

Important: If you use a foreign broker (e.g., Interactive Brokers, Degiro, or similar platforms), you are almost certainly in the declaration regime and must report all gains yourself.

Step 2: Gather Your Documentation

Collect all relevant documents before you start your return:

  • Transaction records: Buy and sell confirmations for all assets disposed of during the year
  • Cost basis documentation: Original purchase prices, including commissions and fees
  • Brokerage statements: Annual statements from Italian and foreign brokers
  • Property deeds: For real estate transactions, the original purchase deed (rogito) and the sale deed
  • Renovation receipts: If applicable, documented costs that increase the property's tax basis
  • Foreign tax certificates: If you paid capital gains tax abroad, documentation for double taxation relief
  • Cryptocurrency records: Detailed transaction logs from exchanges and wallets

Step 3: Calculate Your Capital Gains (and Losses)

For each asset class, calculate the gain or loss:

Capital Gain = Sale Price − Purchase Price − Allowable Costs

Allowable costs may include:

  • Brokerage commissions and transaction fees
  • Notary fees (for property)
  • Documented improvement costs (for property)
  • Currency conversion costs

Capital loss offsetting: Italy allows you to offset capital losses against capital gains of the same category within the same tax year. Unused losses can be carried forward for up to four years. For example, losses on shares can offset gains on shares but cannot offset gains on government bonds taxed at 12.5% (or only proportionally at the ratio of 12.5/26).

Step 4: Complete the Correct Tax Form

Italian individuals file their annual tax return using one of two main forms:

  • Modello 730: The simplified form for employees and pensioners. However, the Modello 730 has limited capacity for reporting capital gains. As of 2024/2025, certain financial capital gains can be reported on the 730, but complex situations still require the Redditi form.
  • Modello Redditi Persone Fisiche (PF): The comprehensive individual tax return. This is the form you'll need for most capital gains reporting.

Within the Modello Redditi PF, capital gains are reported in:

  • Quadro RT — For capital gains on financial assets (shares, bonds, funds, crypto)
  • Quadro RL — For certain miscellaneous income including some capital gains
  • Quadro RW — For declaring foreign financial assets and investments (the Monitoraggio Fiscale section)
  • Quadro RM — For income subject to separate or substitute taxation

For real estate gains where you opt not to use the substitute tax at the notary, the gain is reported in Quadro RL (Section II-A) or as ordinary income in the general income sections.

Step 5: Report Foreign Assets in Quadro RW

If you hold any financial assets abroad — foreign brokerage accounts, foreign property, cryptocurrency on foreign exchanges — you must complete Quadro RW for Italy's tax monitoring obligations. This is required regardless of whether you realized any gains.

Failure to complete Quadro RW can result in severe penalties, including:

  • Fines ranging from 3% to 15% of the undeclared foreign assets
  • For assets in blacklisted countries, fines increase to 6% to 30%

Additionally, foreign financial assets are subject to IVAFE (a wealth tax on foreign financial assets, currently 0.2% of the value) and foreign property is subject to IVIE (a tax on foreign real estate, currently 1.06% of the cadastral or purchase value, with reduced rates for primary residences in the EU/EEA).

Step 6: Apply Double Taxation Relief

If you paid capital gains tax in another country on the same income, you may be entitled to a foreign tax credit under Italy's extensive network of double taxation agreements (DTAs). Italy has treaties with over 100 countries, including the United States, United Kingdom, Germany, France, and most EU/EEA nations.

To claim the credit:

  1. Verify that a DTA exists between Italy and the relevant country
  2. Determine which country has primary taxing rights under the treaty
  3. Report the foreign tax paid in the appropriate section of your return
  4. Claim the credit in Quadro CR of the Modello Redditi PF

The credit is limited to the amount of Italian tax that would be due on the same income — you cannot receive a refund of foreign tax through the Italian return.

Step 7: Submit Your Return and Pay

Here are the critical deadlines for the 2025/2026 tax year:

Action Deadline
Modello 730 submission September 30, 2025 (for 2024 income)
Modello Redditi PF submission October 31, 2025 (for 2024 income)
Payment of taxes due (saldo + first advance) June 30, 2025 (or July 30 with 0.4% surcharge)
Second advance payment November 30, 2025

You can submit your return:

  • Online through the Agenzia delle Entrate (Italian Revenue Agency) portal using your SPID, CIE, or CNS digital identity
  • Through a CAF (Centro di Assistenza Fiscale) — an authorized tax assistance center
  • Through a qualified commercialista (Italian tax accountant/advisor)

Payment is made via the Modello F24 form, using the appropriate tax codes (codici tributo). For the 26% substitute tax on financial gains, the relevant code is typically 1100 for the balance payment.

Common Mistakes to Avoid When Filing

Many taxpayers — especially expats and non-residents — make errors that lead to penalties or overpayment. Here are the most common pitfalls:

  • Forgetting Quadro RW: Even if you owe no tax, failing to declare foreign assets triggers significant fines. This is the single most common and costly oversight for expats.
  • Not reporting cryptocurrency: Since Italy's 2023 budget law, crypto assets are explicitly taxable. Gains above EUR 2,000 in a tax year are subject to the 26% substitute tax. For 2025/2026, all crypto disposals must be reported.
  • Using the wrong cost basis: Italy uses the LIFO (Last In, First Out) method as the default for calculating gains on securities. Using FIFO or average cost without proper authorization can lead to incorrect calculations.
  • Missing the loss carry-forward: If you don't report losses in the year they occur (even if you have no gains to offset), you lose the ability to carry them forward.
  • Ignoring the primary residence exemption conditions: Simply owning a property as prima casa isn't enough — you must have actually resided there for the majority of the ownership period.
  • Double-counting withheld taxes: If your Italian broker already withheld tax under the amministrato regime, don't report those same gains again in Quadro RT.

Special Considerations for Non-Residents

If you're a non-resident of Italy with Italian-source capital gains, your filing obligations are more limited but still important:

  • Real estate gains: Non-residents are generally taxed on gains from Italian property. The same rules apply — the 26% substitute tax or inclusion in ordinary income.
  • Share disposals: Under most DTAs, gains from selling shares in Italian companies are taxable only in your country of residence, unless the shares derive more than 50% of their value from Italian real estate. However, gains from selling a qualified participation (generally above 20-25% of voting rights) may be taxable in Italy.
  • No Quadro RW obligation: Non-residents are not required to complete the foreign asset monitoring section.

Non-residents file using the Modello Redditi PF and should check the applicable DTA to avoid double taxation. If Italy has taxing rights, you'll typically claim a credit in your home country.

For a quick estimate of your overall tax position, you can also use our Italy Income Tax Calculator alongside the Italy Capital Gains Tax Calculator.

Frequently Asked Questions

Do I need to pay capital gains tax if I sell my home in Italy?

Not if you've owned the property for more than five years, or if it has been your prima casa (primary residence) for the majority of the time you owned it. If neither condition is met, the gain is taxable either at progressive IRPEF rates or at the 26% substitute tax.

Can I offset capital losses against capital gains?

Yes, but only within the same income category. Losses on shares can offset gains on shares and similar financial instruments. Losses can be carried forward for four tax years. Remember to report losses even in years when you have no gains.

What happens if I file late?

Filing within 90 days of the deadline is considered a "late filing" and incurs a reduced penalty of EUR 25 (1/10 of the standard EUR 250 penalty) if you pay voluntarily through ravvedimento operoso. Filing more than 90 days late can result in penalties of 120% to 240% of the tax due.

Are gains from foreign stocks taxable in Italy?

Yes, if you are an Italian tax resident, your worldwide income — including gains from foreign stocks — is taxable in Italy. You must report these gains in Quadro RT and declare the foreign accounts in Quadro RW.

How is cryptocurrency taxed in Italy?

As of the 2023 budget law (and continuing into 2025/2026), cryptocurrency gains exceeding EUR 2,000 per tax year are subject to the 26% substitute tax. The cost basis is determined at the time of purchase. All crypto holdings on foreign platforms must be declared in Quadro RW.

Key Takeaways and Next Steps

Filing your capital gains tax return in Italy doesn't have to be overwhelming if you follow a systematic approach:

  1. Identify your tax regime — declaration, managed savings, or managed portfolio
  2. Gather all transaction records well before the filing deadline
  3. Calculate gains and losses carefully, using the correct cost basis method (LIFO)
  4. Complete the right forms — Quadro RT for financial gains, Quadro RW for foreign assets
  5. Claim double taxation relief if you paid tax on the same gains abroad
  6. File on time — October 31, 2025 for Modello Redditi PF covering 2024 income
  7. Pay by June 30 (or July 30 with surcharge) to avoid interest and penalties

If your tax situation involves foreign assets, multiple asset classes, or cross-border considerations, working with a qualified Italian commercialista is strongly recommended.

Ready to estimate your capital gains tax? Try our Italy Capital Gains Tax Calculator for a quick and accurate calculation based on current 2025/2026 rates.

This article is for informational purposes only and does not constitute tax advice. Tax laws change frequently; consult a qualified tax professional for advice specific to your situation.