I agree with Adriatica wholeheartedly. I wasn't suggesting you do nothing but get good advice before you hold your hand up. Your financial adviser's advice may not be the best way forward for your circumstances as you haven't actually avoided tax at all, just not declared everything in the proper manner.I must admit I assumed an ISA would work as KarenR describes but again you need an accountant's advice.Fillide - that is a very useful article. Thanks.
Hi Bunterboy,remember that once you have been physically resident in Italy for more than 6 months you will not necessarily be tax resident in the UK so may no longer be able to take advantage of ISA's. Have you checked the small print? Does it say only for UK residents? I would check with whoever you have your ISA with.
IMHO I would be very careful about sticking my head above the parapet. The UK Inland Revenue sent out letters along similar lines a couple of years ago. They were very intimidating and threatening. They did not actually apply to me as I was resident in Italy at the time but still had a UK bank account, however they scard the pants off me! I spoke to my accountant who told me to ignore it. Which I did and have heard nothing since. Why did I get the letter if it didn't apply to me? My accountant said the Inland Revenue employ these tactics as plenty of people pay up who actually don't need to - pure bully boy tactics. How does that work? You state you underdeclared X and agree to pay a fine of 30%. It is not looked into by the Inland Revenue (that is part of the deal) so plenty of people pay when they don't need to.I would agree that the taxman is defiitely being very thorough in pursuing unpaid tax at the moment but this Scudo Fiscale (as I understand it from the newspapers) is for people who have capital abroad and are not paying Italian tax on it. In this case if you declare it before 15/12/2009 then you can get away with a minimal fine (the 5%), own up to it and so long as you bring the money back to Italy the taxman will say no more. This does not seem to me to apply to you in any sense. I was always under the impression that you must declare the interest on savings even if you have paid tax on them in the UK so I am pretty sure you have done "wrong" there. There will be nothing to pay here (due to double taxation agreements) but it must be declared.Remember these "bigger penalties" will only apply to you if you have avoided or underpaid tax. I can't see that you have.I think if it were me I would make sure my interest was declared on my tax return for this year and find out what would happen if you declared last year's. Usually in Italy you will be fined and have interest charged on the fine but there should still be no tax due.As I understand it everyone who is resident in Italy must make a tax return regardless of where your money is or where you pay tax.I would get a second opinion from a recommended commercialista in your area.Or even a third.
Thanks Lisa. Makes perfect sense.I know Michael Murphy specialises in UK/Italian tax issues. I don't know if he deals with US/Italian tax issues but he might be a good starting point: http://www.mjmurphyaccounts.com/4613.html
I don't kno wwhen you are planning to buy Lisa, but we have our townhouse in Amandola with a garden up for sale at the moment. You can see the details here: http://houses.sibillinicycling.com/
For health costs you still have to contribute a proportion unless you are over Italian retirement age I believe. It is about 30% but the the costs are substantially lower than the US so 30% will be very reasonable. I would guess you could scrape by on 1,000 euro a month for a couple but if you want to do anything more extravagant then you should budget more.As for the tax issues, you really need to speak to an accountant who knows about US and Italian tax regimes to make sure you get good advice. In my experience, mistakes made in Italy with taxes are costly and nigh on impossible to resolve in your favour! The tax man is always right, even when he's wrong.
Do you have a period for which there is no bill? They arrive every 2 months and you pay line rental in advance and calls in arrears.If you have all the bills and have paid them all then I would suggest writing to them (always write and send the letter "raccomandata andato e ritorno" where you get a document proving they received your letter). In the letter enclose all the bills you have received for the period they are querying and all of the payment slips from the post office or internet. If you pay by some other method then include this proof of payment. In the meantime, it is important to continue to pay new bills that arrive otherwise they will cut you off. In the letter, ask them to send a copy of the "missing" invoice.If, however you did not receive a bill for one two month period, then you will have to pay it (obviously) and it is reasonable to request a bill for that period.Have you registered with the www.187.it website? Here you can see your payments and bills on this website and if it was not too long ago, you may be able to reprint the missing bill yourself.
Ahhh. It is not until you hit 5 years and your permesso expires that you'll hit a probem (or not, hopefully). I did hear on the grapevine over the weekend that the particularly obstructive person who created this rule excluding us is likely to be voted out of their job shortly. We live in hope!!
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I agree with Adriatica wholeheartedly. I wasn't suggesting you do nothing but get good advice before you hold your hand up. Your financial adviser's advice may not be the best way forward for your circumstances as you haven't actually avoided tax at all, just not declared everything in the proper manner.I must admit I assumed an ISA would work as KarenR describes but again you need an accountant's advice.Fillide - that is a very useful article. Thanks.
Hi Bunterboy,remember that once you have been physically resident in Italy for more than 6 months you will not necessarily be tax resident in the UK so may no longer be able to take advantage of ISA's. Have you checked the small print? Does it say only for UK residents? I would check with whoever you have your ISA with.
IMHO I would be very careful about sticking my head above the parapet. The UK Inland Revenue sent out letters along similar lines a couple of years ago. They were very intimidating and threatening. They did not actually apply to me as I was resident in Italy at the time but still had a UK bank account, however they scard the pants off me! I spoke to my accountant who told me to ignore it. Which I did and have heard nothing since. Why did I get the letter if it didn't apply to me? My accountant said the Inland Revenue employ these tactics as plenty of people pay up who actually don't need to - pure bully boy tactics. How does that work? You state you underdeclared X and agree to pay a fine of 30%. It is not looked into by the Inland Revenue (that is part of the deal) so plenty of people pay when they don't need to.I would agree that the taxman is defiitely being very thorough in pursuing unpaid tax at the moment but this Scudo Fiscale (as I understand it from the newspapers) is for people who have capital abroad and are not paying Italian tax on it. In this case if you declare it before 15/12/2009 then you can get away with a minimal fine (the 5%), own up to it and so long as you bring the money back to Italy the taxman will say no more. This does not seem to me to apply to you in any sense. I was always under the impression that you must declare the interest on savings even if you have paid tax on them in the UK so I am pretty sure you have done "wrong" there. There will be nothing to pay here (due to double taxation agreements) but it must be declared.Remember these "bigger penalties" will only apply to you if you have avoided or underpaid tax. I can't see that you have.I think if it were me I would make sure my interest was declared on my tax return for this year and find out what would happen if you declared last year's. Usually in Italy you will be fined and have interest charged on the fine but there should still be no tax due.As I understand it everyone who is resident in Italy must make a tax return regardless of where your money is or where you pay tax.I would get a second opinion from a recommended commercialista in your area.Or even a third.
Thanks Lisa. Makes perfect sense.I know Michael Murphy specialises in UK/Italian tax issues. I don't know if he deals with US/Italian tax issues but he might be a good starting point: http://www.mjmurphyaccounts.com/4613.html
I don't kno wwhen you are planning to buy Lisa, but we have our townhouse in Amandola with a garden up for sale at the moment. You can see the details here: http://houses.sibillinicycling.com/
I have this one: http://www.amazon.co.uk/Restoring-Home-Italy-Elizabeth-Minchilli/dp/1579... which has some vaguely practical sections that explain how a roof is constructed etc. It won;t help you build one but every little helps.
Thanks Sprostoni for your kind words. Thanks Carole for the tip. I was about to sign up for the email bill but I won't now!
For health costs you still have to contribute a proportion unless you are over Italian retirement age I believe. It is about 30% but the the costs are substantially lower than the US so 30% will be very reasonable. I would guess you could scrape by on 1,000 euro a month for a couple but if you want to do anything more extravagant then you should budget more.As for the tax issues, you really need to speak to an accountant who knows about US and Italian tax regimes to make sure you get good advice. In my experience, mistakes made in Italy with taxes are costly and nigh on impossible to resolve in your favour! The tax man is always right, even when he's wrong.
Do you have a period for which there is no bill? They arrive every 2 months and you pay line rental in advance and calls in arrears.If you have all the bills and have paid them all then I would suggest writing to them (always write and send the letter "raccomandata andato e ritorno" where you get a document proving they received your letter). In the letter enclose all the bills you have received for the period they are querying and all of the payment slips from the post office or internet. If you pay by some other method then include this proof of payment. In the meantime, it is important to continue to pay new bills that arrive otherwise they will cut you off. In the letter, ask them to send a copy of the "missing" invoice.If, however you did not receive a bill for one two month period, then you will have to pay it (obviously) and it is reasonable to request a bill for that period.Have you registered with the www.187.it website? Here you can see your payments and bills on this website and if it was not too long ago, you may be able to reprint the missing bill yourself.
Ahhh. It is not until you hit 5 years and your permesso expires that you'll hit a probem (or not, hopefully). I did hear on the grapevine over the weekend that the particularly obstructive person who created this rule excluding us is likely to be voted out of their job shortly. We live in hope!!