Italian is the main language, but German is spoken in the South Tyrol Region, French is used in the Valle d’Aosta on the Swiss/French border and Slovene is common in the far west
GMT +1 ( 2 hours from the last Sunday in March to last Sunday in October )
Post Offices – 8.30am-1.30pm and 2.30pm/3.00pm to 4.00pm, Monday to Friday
Banks – 8.30am-1.30pm and 2.30/3.00pm to 4.00pm, Monday to Friday
Shops – 8.30am-12.30pm and 4.00pm to 7.30pm, Monday to Saturday
Shopping Malls – Similar to shops, but some stay open all day and sometimes close later in the evening
Driving is on the right
The purpose of this guide is to give you a general overview of purchasing and owning your own property in Italy.
Its aim is to provide you with an insight into the steps you will need to take, as well as hopefully answer some of the questions you have around the purchase process. It is not meant as the definitive guide to purchasing property in Italy, but to assist you with some of the knowledge you will need.
We hope this guide assists you in your decision to purchase one of the Italian properties for sale we market on behalf of the developers, agencies and constructors we work with.
Before making any purchase, we strongly recommend you consult with all the necessary agents, Lawyer, Tax Advisor, Financial Advisor etc., before signing any legal agreements.
There are no restrictions on non-Italian residents wishing to purchase a property in Italy. In general there are 3 key stages to the purchase process, but this does depend on the type of property you are buying.
Stage one is the offer, you can agree a purchase straight away by signing a “Proposta irrevocabile d’acquisto, which is a binding purchase agreement, signed by the seller and the purchase. This initial agreement, states an expiry date by when the Preliminary contract must be signed. It is at this time that a deposit, usually no more than 10%, is paid by the purchaser. This is non-refundable, unless the sale fails to complete through no fault of the purchaser.
At this stage, we would recommend you employ the services of a “Geometra” (surveyor) to carry out a survey of the property (in case of re-sale), and to carry out the necessary searches.
Stage two is the Preliminary Contract, called “Compromesso”, which commits both the seller and purchaser to the sale, similar to the Exchange of Contract process in the UK. The “Compromesso” will contain all the relevant terms and conditions that have been agreed, including, the price, date for completion, the type of property and guarantees provided by the seller – all of which goes into the final contract.
It is at this point that an additional deposit is paid, this is known as the “Caparra” and is usually about 1/3 of the agreed price, but can varying, particular in the case of an off-plan purchase. If you withdraw from the sale, after signing the Compromesso, you will lose all the deposit that you have paid to date, however, under Italian Law, if it is the seller that withdraws, they have to pay you double the amount of your deposit.
The third and final stage is the completion, which similarly to other countries, takes place in the offices of the local notary. It is the notary’s responsibility to prepare the Title Deed, known as the ‘Rogito’, and to oversee the execution, registration and payment of all Italian taxes related to the sale. This constitutes the finalisation of the transaction and ownership of the property, and then transfers from the seller to the purchaser. At the signing, the seller, purchaser and if relevant the estate agent, all have to have present for the signing of this contract. However the purchaser, does not have to be present in person, you can appoint someone to sign on your behalf, providing them with your power of attorney. It is at this final stage when the balance of funds must be transferred to the seller.
It is also worth noting that if you are a married woman, the deeds in Italy will be put in your maiden name.
What is the role of the Geometra?
The Geometra is responsible for organising a survey, the local land registry and all the “Commune” checks, with regards to local planning and building regulations. Should the searches reveal anything that impacts the sale of the property, then the sale cannot be completed. These checks and searches are relatively quick and should be finished within two to three weeks. What the Geometra is looking at is,
What is the role of the Notary?
All the legal documentation pertaining to the sale of the property, such as the Compromesso and Rogito are prepared by the Notary. They are also responsible for a number of checks themselves, which include
One drawback of a purchase in Italy compared to the UK is that the costs of process are higher. Some elements of the costs do vary, but as a guide to non-residents, we recommend you budget approximately 16% of the agreed purchase price, for costs. Some of the costs you should anticipate are
*Under Italian Law a property have a declared value. This is a statutory figure placed on the property by the Government. Generally this value is quite significantly lower than the actual purchase price and it is this figure that usually appears in documents, relating to the property. The amount of tax payable, as a result, is a lot less.
Cost of ownership
The actual costs will vary, depending on the property, but in addition to any mortgage payments that you will be responsible for, there are also the following costs to pay
As with many countries, this is a complicated area, therefore we strongly advise that you take advice from an Independent Tax advisor, we will be happy to facilitate an introduction for you however.
We provide the following as a guide only
A non-resident in Italy is legally obliged to make an annual tax return in Italy. The Authorities are solely interested in income that comes from activity based in Italy, not from anything related to your world-wide income. In this category would be items such as interest earned in an Italian Bank, rental returns if you rent your Italian property out for any period of time. In the case of rental of your property, you have to declare 85% of the income generated, which is taxed at 20%. It is possible to off-set certain expenses against income, for items such as repairs, management fees, local taxes and the like. What is left would be taxed at between 23% and 43%, depending on the amount of income.
This income would also have to be declared in your home country, but due to the double taxation treaty that exists in Europe you would only pay tax in Italy on the income received in that country. Please note that you must file a tax return in Italy, even if you receive no income from you property, or anywhere else in the country.
This is the equivalent of a Tax Code in the UK and you are required to have this number, even if you are not a full time resident or do not have a requirement to pay tax in Italy. This number can be obtained from your local tax office. Such is the requirement to have this number that normally you cannot set up a utility account, without one.
Only if a property is sold without 5 year of purchase, does the owner become liable for Capital Gains Tax, which is currently at the rate of 20%.
These were both abolished and then later re-introduced in 2007, but at a lower rate that was in place before 2001. Any inheritance or gift about 1Million Euros that is paid to a spouse, child or parent is liable for tax at a rate of 4%. To a sibling, the rate is 6% on anything over 100,000Euros, other relatives, up to 4th degree, pay 6% on anything received. Unrelated people are liable for 8% on the entire amount.
As you would expect, obtaining a mortgage on a property in Italy is straightforward, dependent on your personal situation and as long as the property is registered at the land registry as a habitable, civil dwelling. There are a number of ways buyers can obtain the funding required,
Generally the maximum loan to value for the purchase is 80% of the purchase price, however for a renovation the maximum LTV is 70% of the final property value and it can be arranged for funds to be provided, as the work progresses.
We would be happy to provide you contact details of the Mortgage Providers we work with.
Please note these details have been prepared as a guide only. Different communes can apply different rules and regulations relating to the purchase of property and change these from time to time, so it is not feasible to cover every single permutation in these notes.
For more information on our properties for sale in Italy, please visit our Property Search
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