Former MotoGP world champion Valentino Rossi has agreed to pay 35 million euros ($A56.29 million) to Italy's tax agency after coming to an agreement following a lengthy probe.

A statement before a news conference in his home town said the 28-year-old will pay 19 million euros ($A30.56 million) for the period 2001-2004, with payments for 2005 and 2006 making the total figure around 35 million euros ($A56.29 million).

The tax agency said in August that the winner of seven world titles was being investigated for tax evasion linked to his decision in 2000 to take up residence in Britain.

Media reports said Rossi could have faced a bill for as much as 112 million euros ($A180.14 million).

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