We recently published a piece on how the European family office scene is recalibrating rather than diminishing.

Yet within the region there are definite winners and losers.

London is losing ground, with a constant news on how the wealthy are disillusioned with the current government and unfavorable tax legislation, each week bringing more news of wealth migration.

Just this week we were liaising with another former London-based family office principal who recently decided to leave. His new home: Milan.

Milan is benefiting from Italy’s flat tax regime for high-net-worth individuals, which allows new residents to pay a fixed annual tax on all foreign income. 

Last week the rate was raised from €200,000 to €300,000, but the incentive is still significant.

Official figures show 3,434 individuals opted for the HNWI flat tax regime between 2021 and 2023, and that number is likely to increase in the coming years.

There’s increased interest from the US and UK, says Maria Paola Serra, a managing counsel in the Dentons Milan office, who says Milan offers a unqiue blend of financial infrastructure, tax incentives, and cultural capital.

She says the arrival of UHNWIs has led to a visible impact across various sectors. 

“The real estate market has seen a marked increase in demand, particularly within the upscale property segments. The luxury services sector, already a hallmark of Milan, has experienced further growth.” 

She also notes how the hospitality and dining industries have thrived, with a rise in clientele at high-end restaurants and exclusive hotels.”

Serra paints the picture of the city as a soft landing for new arrivals, with easy networking and integration into the local and international business community.

“Milan is generally welcoming to foreign family offices, offering a range of networks and clubs to join. The city hosts several family office networks and private clubs that facilitate networking and collaboration among high-net-worth individuals and families.”

The influx of wealthy families presents significant opportunities for the broader industry that enables their seamless establishment in the city. 

Serra says the Dentons Milan office is well-engaged, providing a comprehensive support offering.

“These services typically include legal advice on estate relocation, corporate structuring, tax planning, real estate acquisitions, compliance with local regulations and succession planning.” 

But they also assist with immigration matters and will provide guidance on integrating into the local business environment.

While the flat rate has already been raised three times, Serra still believes the government has the right approach in evolving this to economic conditions and policy priorities.

“The focus will likely remain on balancing competitiveness with fiscal sustainability to ensure Italy remains a desirable destination for ultra-high-net-worth-individuals.”

Read a more detailed view on Milan: Europe’s Quietly Ascendant Family Office Hub.

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