Relocation to Italy: taxes and fees for homebuyers

Relocation to Italy is a life-changing decision. Most people who choose to set up home in Italy understand that the country has a lot of potential in terms of investment opportunities as well as offering fabulous beaches, picturesque scenery and a wonderful lifestyle. Whether they have been a frequent visitor to the ‘Bell Paese’ or simply fallen in love at first sight, international buyers have come to the conclusion that they want to enjoy the “dolce vita”.

IB International Real Estate experts are sharing some valuable insights on the costs of purchasing a property in Italy. Whether you’re interested in rare finds on the Italian Riviera, modern or stately homes on the Lakes, traditional villas and historic estates in Tuscany or rustic farms in the south, our portfolio is full of possibilities.

 

‘L’imposta di Registro’ to be paid to ‘L’Agenzia delle Entrate’ (Italian National Tax Agency)

If both the buyer and the seller are two natural persons (as opposed to a company) and the object of sale is a property for residential purposes, the property tax is based on the ‘declared’ value of the property in the ‘rendita catastale’ (official property record) which is generally less than the actual purchase price or its market value, sometimes much less.

If the buyer is planning on being a resident in Italy and making the property their primary residence within eighteen months of the purchase then the tax is 2% on the cadastral value.

 

IVA (Value Added Tax) – Only for brand new constructions where the seller is a company

Buyers of brand new properties don’t pay L’Imposta di Registro, instead, they pay IVA – Imposta sul Valore Aggiunto (value added tax).

For buyers that will use the property as their primary residence, the tax is 4%, and for luxury properties that have a property register code of A1, A8 or A9 the tax is 22%.

 

Notary’s Fees

Notary’s fees depend on the price of a property and the complexity of the contract. Included in the notary fees are additional small tax duties that the notary is obligated to pay on your behalf. In addition, there are copying fees, filing fees and translation fees.

All of the fees are itemized on the bill by the notary so that you can better understand the costs. Generally speaking, notary’s fees for a property purchase can be anywhere from around 800 euros to 5 000 euros.

 

Imposta Municipale Unica (IMU). Annual Property tax to the Commune

If you are a resident or plan on becoming a resident within the first 18 months of the sale and the house is not zoned as a luxury residence and will be used as your primary residence, then there is no annual tax.

 

Translations

If you don’t speak Italian then it is necessary that the final act of sale be translated into your language by an officially licensed translator. In addition to this, you may need a live translator present during the Atto Notarile. Often the notary will arrange a translator for you and the costs will be included in the notary’s fees.

 

Real Estate Agent’s Commission

Real estate agencies generally take a commission of between 2% and 5% of the selling price of the property, 4% being the most common. You will also need to pay VAT (sales tax) which is 22% on the commission.

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