The Italian law wants to facilitate and encourage the purchase of the main house (first home) and thus it provides for taxes that are lower than those normally due.
Also foreigners can be eligible for “first home” tax breaks, when they possess the necessary requisites. In particular, at the purchase stage:
- when purchasing the first home from a private person, non-construction company or construction (or restoration) company after more more than 4 years from the completion of works, they will pay a registration tax equal to 3% of the cadastral value of the house, and mortage and cadastral taxes with a fixed amount whose total is equal to 336 euro;
- when purchasing from a construction company, within 4 years of the completion of the works, they will pay a 4% VAT, and registraion, mortgage and cadastral taxes with a fixed amount whose total is equal to 504 euro.
In order to benefit from the tax breaks it is necessary that the purchase is related to a property that:
- is classified as house, and therefore its cadastral classification falls within the categories A/1 and A/11;
- is not classified as “luxury” according to Ministerial Decree 218/1969;
- it is situated in the municipality where the buyer is residing or where they intend to, within 18 months, transfer their residence.
The benefits can be applied to the appurtenances of the house as well but with the limitation of one for each of the cadastral categories C/2 (cellar or attic), C/6 (garage) and C/7 (open or closed shelter).
In addition to the characteristics of the property, in order to be able to benefit from the tax breaks it is necessary that the buyer:
- within 18 months of the purchase, they bind themselves to establish their residence in the Municipality where the property to be purchased is situated, in case they don’t reside there yet;
- can not be the exclusive owner, or jointly owner with the spouse, of rights of property, usufruct, use and occupancy of another house within the Municipality where the property to be purchased is situated;
- can not be the owner, throughout the national territory, of rights of property, usufruct, use, occupancy and bare ownership related to another house purchased by the same subject or by their spouse, benefitting from first home tax breaks over the years.
Both foreign citizens and expatriates are allowed to benefit from first home tax breaks. It is necessary to specify that the taxpayers who don’t have Italian citizenship are allowed to purchase with first home tax breaks if they meet all the necessary requirements.