Prima casa vs. Non-resident

When you buy your home, you will either buy it as your ‘prima casa’ or as a non-resident.

Prima casa means your principal home. You qualify for prima casa if you take out residency at your acquired property within 18 months of the signing of the Final Contract and you must spend at least 6 months out of the year at that address. With prima casa you are given a considerable tax concession.

If, however, you are buying the property in Italy as a holiday home, and not intending to live there for at least half the year and therefore not taking out residency (or you already own a house in Italy registered as prima casa, the new property becoming your second home) then you will pay the higher tax rate.

Taxes and fees paid by the purchaser

The following taxes apply and are sent by the notaio, together with the deeds and documents, to the Land Registry to ensure that registration is complete:

• Registration Tax (Imposta di registro) is applied whenever there is a new registration of title.

• Mortgage tax (Imposta ipotecaria) is applied whenever there are amendments, additions or cancellations to the public register, or to lodge new or discharge previous mortgages or covenants. Even if you are buying the property without a mortgage, the notaio still must lodge this information at the public register.

• Cadastral/Land Registry tax (Imposta catastale) is applied to transfer the change in the name of the property owner.

The following percentages can be based either on the purchase price or the cadastral* (declared) value - the latter can be a considerably lower figure and is the one generally used.

If the property is purchased as ‘Prima casa’, and the vendor is an individual:
Registration tax - 3%
Mortgage tax - €168
Cadastral tax - €168

If the property is purchased as ‘Prima casa’, and the vendor is a building company (eg. new builds):
VAT - 4%
Registration tax - €168
Mortgage tax - €168
Cadastral tax - €168

If the property is purchased as second home/non resident, and the vendor is a private individual:
Registration tax - 7%
Mortgage tax - 2%
Cadastral tax - 1%

If the property is purchased as second home/non resident, and the vendor is a building company:
VAT - 10%
Registration tax - €168
Mortgage tax - €168
Cadastral tax - €168

In addition:

17% for any Land not immediately surrounding the property. Although this is a very high figure, land in Italy is declared at a low value.
20% on properties categorised as Luxury homes (based on certain internal and external characteristics).

Other fees

Agency fee: 3% of the purchase price.

Notaio: The fee depends on the amount of work involved and the cost of the property, but normally is around 3% of the cadastral value.

Geometra and Translator (if used): Based on specific professional tariffs.

Homeowner's tax

ICI (Imposta Comunale sugli Immobili)
‘Prima casa’ owners are no longer subject to this tax. Otherwise the tax is due twice a year in June and December and is paid to the Comune (local district) where the property is located. The tax varies between 0.5-0.8% of the cadastral value.

Taxes and fees paid by the vendor

If you have retained the house for 5 years or more, no tax is due.

If you sell before the 5 year period is up, you must do one of the following:

• Buy another property within a year of signing the Final Contract, that property becoming your next prima casa
• Pay capital gains tax (plusvalenza) on the profit you have made on the sale. The profit is computed as selling price, less acquisition costs and expenses on improvement. It can be declared when you file your annual tax return, falling within the category of ‘different incomes’, or it can be paid at the Final Contract at the rate of 20%.

Agency fee: 3% of the purchase price

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