Real Estate

Italian taxation of land property purchases after D.L. 104/2013

Posted on 09/01/2014

xmas_070In Italy, in order to transfer land property it is necessary a notarial deed.
The notary collects duties and taxes on behalf of the State as well as expenses incurred with the public administration offices for preparing the deed and subsequent formalities.

The Italian taxation law on land transactions, in particular, has recently been reformed: in fact, the decree law 104/2013 modifies the rates which applies, for example, to the purchase of residential houses.
First of all, in order to calculate the amount of the taxes it is necessary to understand if the seller is an individual or a company and than to distinguish whether or not the buyer owns other land properties which were bought as “primary dwelling”.

When purchasing the first house, in fact, the buyer has right to the application of lower rates (see the box below), but the tax break is not applied fot the further purchases.

1. Conveyance of a property between individuals:
– to be used as primary dwelling:
registration duties         2% (minimum € 1.000)*
mortgage duties           € 50
cadastral duties            € 50
stamp duties                exempt
mortgage tax               exempt
cadastral transfer         exempt

other properties:
registration duties        9% (minimum € 1.000)*
mortgage duties           € 50
cadastral duties            € 50
stamp duties                exempt
mortgage tax               exempt
cadastral transfer         exempt

* The purchaser may ask that the registration, mortgage and cadastral/land registry tax be paid on the “cadastral value” of the property (namely the value obtained by multiplying the cadastral income by the official coefficients: 115.5 if the property is the first dwelling house being bought; and 126 in all other cases), irrespective of the actual purchase price, even if it is higher.

2. Conveyance of a property between individuals and construction companies (and sold within 5 years from the building):
– to be used as primary dwelling:
VAT                             4%
registration duties         € 200
mortgage duties           € 200
cadastral duties            € 200
stamp duties                € 230
mortgage tax               €   35
cadastral transfer         €   55

other properties (not luxury building):
VAT                            10%
registration duties        € 200
mortgage duties          € 200
cadastral duties           € 200
stamp duties               € 230
mortgage tax              €   35
cadastral transfer        €   55

pdfItalian Real Estate Taxation table

 

Elena Parmegiani