| TAXES ON THE PURCHASE OF A HOUSE
Taxes on houses
Whoever buys a house must pay the registration tax, or else VAT, as well as mortgage and cadastral taxes.
More specifi cally:
− If the seller is: a private individual;
a “non-construction” company;
the “construction” company (or the company that has renovated
the building) and has completed the work 4 or more years ago;
• the taxes to be paid are:
- registration tax 7%
- mortgage tax 2%
- cadastral tax 1%.
- If the seller is:
the “construction” company (or the company that has renovated
the building) and the sale is made within 4 years from completion
of the work; the taxes to be paid are:
- VAT at 10% (or 20% if a luxury building)
- fixed registration tax 168.00 euro
- fixed mortgage tax 168.00 euro
- fixed cadastral tax 168.00 euro.
The taxes are paid by the notary at the time of the registration of the deed. The proportional taxes are paid on the price, except when there are the conditions for requesting in the notarial deed of sale the application of the “price-value” clause: the price paid is declared, but the proportional taxes are paid on the cadastral value of the property if:
- the sale regards real property for use as a dwelling and/or related appurtenances;
- the buyer is an individual who is not acting in the practicing of commercial, artistic
or professional activities;
- the deed is subject to registration tax (thus sales subject to VAT are excluded).
Thus any advantages from making statements aimed at tax evasion are nullifi ed. The notary’s fees are also reduced by 30%. The price-value mechanism applies on the condition that the entire agreed price is indicated in the deed: if the agreed amount is concealed, even partially, the consequences and penalties are very high.
First home benefits
When one buys a “fi rst home” the taxes are reduced:
- If the seller is:
- a private individual a “non-construction” company
- the “construction” company (or the company that has renovated the building) and has completed the work 4 or more years ago
• the taxes to be paid are:
- registration tax 3%
- fixed mortgage tax 168.00 euro
- fixed cadastral tax 168.00 euro.
- If the seller is:
- the “construction” company (or the company that has renovated the
building) and the sale is made within 4 years from completion of the work the taxes to be paid are:
• VAT 4%
• fixed registration tax 168.00 euro
• fixed mortgage tax 168.00 euro
• fixed cadastral tax 168.00 euro.
First home prerequisites
PROPERTY: It must be a “non-luxury” home
BUYER: The buyer must live in the Municipality where the property is located or must move there within 18 months from the stipulation of the deed or prove that their main work is in the Municipality where the property is located;
The buyer must not hold, either alone or together with their spouse, any rights (ownership, use, usufruct or habitation) on another home in that Municipality;
The buyer must not be the owner, not even partial, of rights of property, usufruct, use, or habitation on another home purchased with fi rst home benefi ts anywhere within the national territory. In order to avoid speculating, the property purchased with “fi rst home” benefi ts cannot be sold before fi ve years have passed from the date of purchase, under penalty of loss of the benefi ts, and the payment of surtaxes and interest. This loss of the benefi ts can be avoided by purchasing another house within one year from the date of sale. In this case one may also avail themselves of the “tax credit,” as a kind of discount on the new purchase, equal to the tax paid on the fi rst purchase. |
