Gift and inheritance taxes: Favorable Legislative Changes for Heirs

Recently, Italian Legislative Decree No. 139 of September 18, 2024, which entered into force on January 1, 2025, introduced amendments to tax regulations concerning gifts and inheritance, providing advantageous effects for heirs (spouses and children).

In particular, paragraph 4 of Article 8 of Legislative Decree No. 346 of October 31, 1990 (Unified Text on Inheritance and Gift Taxes) has been repealed.

Previously, at the time of succession, the value of gifts made during the decedent’s lifetime was added to the hereditary estate, and the inheritance tax rates were determined on the total sum. This so-called "aggregation" inevitably led to a significant tax burden on heirs.

Specifically, if an heir had already received an asset as a gift, the value of the gifted asset was added to the value of the inherited asset, and the inheritance tax was applied to the resulting amount.

As of January 1, 2025, the value of gifts made during the decedent’s lifetime will no longer be aggregated with the hereditary estate for the purpose of calculating inheritance tax.

Consequently, heirs and legatees will be able to fully benefit from the applicable tax exemptions, regardless of any prior gifts received.

This reform simplifies family wealth management and reduces the tax impact on inheritance, with significant consequences particularly for substantial estates, allowing for considerable tax savings.

In light of these changes, it is essential for those planning the transfer of their assets to carefully evaluate these legislative developments, seeking the assistance of a professional advisor.

Milan 02.04.2025

Avv. Giovanni Babino