Commission Details and conditions
The appointment for the sale with our real estate agency and our real estate agents is formalized with a written agreement or, without any document, with the utilization of the services shown in our service brochure, in our real estate expose and relevant conditions. The brokerage fee (commission) is to be paid by the buyer and by the seller in the amount of 4.00 % + VAT each on the purchase/sale price. The commission shall mature and become due at the sales agreement between the seller and the purchaser (sale proposal signed by the promissee purchaser and duly accepted by the promissory seller). S.I.S. Real Estate di Ivan Gobetti and its agents have therefore the right to immediately demand the payment of the commission when the above mentioned circumstance occurs. Registration fee, notary costs, land register fee and mortgage tax are to be paid by the purchaser. No responsibility will be accepted by S.I.S. Real Estate di Ivan Gobetti for the information provided in the website, as all materials are supplied by the purchaser and/or by his trustworthy professionals. S.I.S. real Estate di Ivan Gobetti considers this information to be truthful and does not take responsibility for it to be out-dated, partial or inaccurate. It is understood that the seller, besides his obligation towards S.I.S. Real Estate di Ivan Gobetti, has the right to sell the property to third parties until the signature, for acceptance, of the sale proposal submitted by the promissee purchaser. In case the purchaser already visited the property, he has to communicate it to S.I.S. Real Estate di Ivan Gobetti. In connection with anything not expressly provided for in this document, the Italian Civil Code provisions are valid.
1. PURCHASE OF PROPERTY
2. TAX RELIEFS FOR PURCHASES OF „FIRST HOMES“ (PRIMA CASA – ONLY RESIDENCE)
3. SALE OF PROPERTY
4. TAX CREDIT FOR PURCHASE OF A NEW „FIRST HOME“
5. PURCHASE OF A RESTRUCTURING PROPERTY
6. MORE INFORMATION
Recently real estate market was changed, especially estate taxation. In the first place it was done for some tax reliefs pertaining to the puchase of the „first home“. In particular, act no.266/2005 (financial for 2006) introduced a new system of tax relief for an onerous disposal of property. It is more favourable for ratepayers. Act no. 223 of July 4, 2006 changed in the act no. 248 of August 4, 2006 modified again the tax system of real estate: it introduced new rules of taxation for disposals of property spreading registration tax and creating some exceptions for application of VAT; it specified some contemplations purpose of discouraging elusive and evasive operations; it is compulsory to indicate terms of payment and real estate agent participation in the notarial deed. In compliance with a financial law of 2007 Italian Revenue Agency and Guardia di Finanza (in Italy it is police whose specific task is to enforce tax evasion laws) have a task to control the execution of this new rules. Here you can find information about the changes in the system of real estate taxation, information about tax reliefs for purchase of homes and information about capital gain taxation.
PURCHASE OF PROPERTY
TAXES ON THE PURCHASE OF AN IMMOVEABLE PROPERTY
On the purchase of an immovable property there is a registration tax (imposta di registro) or alternatively VAT (depending on the seller) as well as the Cadastral and Land Registry taxes (imposte Ipotecarie e Catastali). The payment of such taxes is naturally at the expense of the buyer. When the seller has a VAT number and operates in the construction industry (for example, a construction firm, a firm which held the planning permission or which restructured or restored the property), the following must be paid on the purchase price indicated in the purchase deed:
VAT at ten percent (twenty percent if it is a luxury property)
Fixed Registration tax: €168.00
Fixed Land Registry tax: €168.00
Fixed Cadastral tax: €168.00
In other cases (for example, a purchase from a private individual or a business different from the ones indicated above or a construction firm, but 4 years passed from the work termination) the taxes payable are: Registration tax: seven percent
Land Registry tax: two percent Cadastral tax: one percent Buying property as a „first home“, the purchaser can enjoy some tax reliefs.
CALCULATIONS OF TAXES
Registration tax, Land Registry tax and cadastral tax The taxes (registration, cadastral and land registry) are paid by the buyer to the Notary Public at the signing of the purchase deed and then by the Notary Public to the Inland Revenue at the time of registration of the contract. In compliance with a financial law of 2007 when the purchaser of a purpose-built apartment is a private individual without any commercial professional or artistic purposes, the taxable base for the application of the proportional registration tax, land registry tax and cadastral tax comes from the cadastral value of the property (not from the commercial value). In 2006 this rule worked only when both the purchase and the seller were private individuals. To benefit from the application of the taxes (registration tax, land registry tax and cadastral tax) on the cadastral value of the property, the purchaser have to apply for it to notary. Furthemore, to use this special term, an agreed amount must be indicated in the disposal deed. In fact, the tax relief will be revoked in case of concealment or underdeclaration of the amount. Moreover it will lead to the following consequences: the taxable base for the application of the proportional registration tax, land registry tax and cadastral tax will be calculated from the agreed value of the property (commercial value); sanction: from 50% to 100% of the lowest paid taxes; reduction (30%) of notary’s fee which is calculated from the value of the property indicated in the deed.
This tax relief (cadastral value-taxable base) is valid only when the private individual purchases a purpose-built apartment/house or its pertinence (garage, cellar etc.)
In other cases (puchaser is not a private individual and/or he/she puchases a building or agricultural land etc) the taxable base for the application of the proportional registration tax, land registry tax and cadastral tax comes from the agreed value of the property (commercial value).
Taxable base of VAT
When the seller has a VAT number and operates in the construction industry (for example, a construction firm, a firm which held the planning permission or which restructured or restored the property), the following must be paid on the purchase price indicated in the purchase deed.
In case the purchase price indicated in the purchase deed is false, „ufficio“ can adjust the annual VAT declaration of the seller.
In case the buyer took out a loan for purchase property, the taxable base cannot be lower then the loan ammount.
NEW SUBSTITUTE DECLARATION
„Substitute declaration of the notarial act“ must be included in the purchase deed. The following points must be in there:
terms of payment (bank transfer, bank cheque etc.) of the amount; presence of brokerage (in this case all the information about owner and organization (name, title, private individual or not, VAT number, taxpayer number etc.) costs of this activity with terms of payment.
Omissions and falsifications will be punished by a legal sanction and taxability with registration tax purpose. „Ufficio“ will control the value of property in question. „Ufficio“ will applicate taxes on the purchase value (not on cadatral). Also there is a fine from €500 to €10.000. In case the broker doesn’t have a commercial number, the notary must report it to The Revenue Agency.
TAX RELIEFS FOR PURCHASE OF AN IMMOVEABLE PROPERTY
Since January 1st , 2007 the purchase could have taken out 19% of the sum paid for real estate brokerage from „personal income tax“ (Irpef). The amount cannot be more than €1000. If there are more than one purchaser the maximum limit of €1000 must be distributed between them, and the sum of each one depends on percentages they have from the property.
CADASTRAL VALUE OF AN IMMOVEABLE PROPERTY
In general and apart from exceptions (for example, the purchase of building and agricultural land), the taxable base for the application of the proportional registration tax comes from the cadastral value of the property. The cadastral value is calculated by multiplying the cadastral income (5%) by the following coefficients: 110 for the „first home“; 120 – for buildings belonging to cadastral groups A, B, C (excluding categories A/10 and C/1); 60 – for buildings of the categories A/10 (public and private offices) and D; 40.8 – for buildings of the categories C (shops and stores) and E.
For transfers subject to VAT the taxable base is always the price agreed between the parties.
Act. no. 262 of 2006 is about multiplying the cadastral income at 40% for cadastral group B.
If property is not in the land registry
If the property is not in the land registry, the seller and the purchaser can use an assumed income to the cadastral value. It is necessery indicate it in the deed refering to the art. no.12 of D.L. no. 70 of 1988 converted by low no. 154 of 1988. The Territory Agency (Agenzia del Territorio) will report the cadastral income to the taxpayer.
In case the value of the cadastral income indicated in the deed is lower then a real one, the taxpayer must pay an owned tax and the respective interests.
CLASSIFICATION OF BULDINGS
Every single property is classificated by some standards which are relating to its characteristics, destination and its cadastral survey fixed by Municipality (Comune).
It is a standard based on the quality of finishes, services, size of the rooms and its position.
The number of the classes dipends on different Municipalities. The first class identifies the property with the lowest income, the last class identifies the property with the highest income. Consistency It describes the roominess of the property, which is express by different units of measurement (dipends on category). Cadastral income Every property in the country is listed in the Cadastre (land registry) and an annual net rental income is assigned to it: the cadastral income. The cadastral income is calculated by multiplying the rate for the consistency of property (rooms, sqm etc.). Cadastral rates are published in the Gazzetta Ufficiale, you can find it at the Territory Agency as well (ex Cadastral offeces). The cadastral income can be revalued if the characteristics of the property change. Since 1997 the cadastral income has been revalued at 5%.
TAX RELIEFS FOR PURCHASES OF „FIRST HOMES“
If the property to be purchased is to be the buyer’s „first home“ (prima casa) a significant tax reduction is generally available. The purchase of the „first hom“ benefits from specific tax advantages: registration tax or, alternatively, VAT are paid applying reduced rates; land registry and cadastral taxes are due in a fixed amount. Purchase from private individual: registration tax: 3% (not 7%); land registry and cadastral taxes: €168 (not 2% and 1% respectively). Purchase from companies: Specifically, in cases where the seller is a VAT number owner working in the construction industry, VAT is paid at the reduced rate of 4%, and the registration, land registry and cadastral taxes are paid in the fixed amount of €168 each. In the other cases (e.g., purchase is not a constraction company or it is construction company but 4 years passed from the work termination), the rate of 3% instead of 7% applies for the registration tax, and the land registry and cadastral taxes are paid in a fixed amount of €168 each (instead of 2% and 1% respectively). Without tax relief for the „first home“ the purchaser must pay VAT rate of 10% (20% if the property is luxury).
In order to take advantage of the „first home“ it is generally required that: the buyer be a private individual; the property be not a luxury house as set forth by Ministerial Decree (08/02/1969), published in the Gazzetta Ufficiale no. 218 of August 27th , 1969; the real estate be located in the Municipality (Comune) where the purchaser has his/her own residence, or in which the purchaser intends to transfer it within 18 months from the date in which the deed of sale was executed, or where the purchaser performs his/her professional activity.
Furthemore, the purchaser must declare in the purchase deed that: he/she is not the sole holder, or in conjunction with the spose of rights of property, use, usufruct, and housing of other real property for housing proposes in the territory of the Municipality where the property is located; he/she is not the holder, either for quotas or in legal communion, nationwide, of rights of property, use, usufruct, housing on another home, purchased – even by the spose – taking advantage of the „first home“ benefits; he/she will transfer his/her residence within 18 months in the Municipality where the real estate is located, in case he/she does not already reside there. Italian citizens emigrated abroad have the right to enjoy the benefits provided by low for the purchase of „first homes“ if they purchase a real property as their first dwelling within the territory of Italy, without the mandatory requirement that they must transfer their residence within 18 months in the Municipality where the real estate is located. Foreign national (with no Italian citizenship) have the right to enjoy the benefits provided for the purchase of „first homes“ if they purchase a property as their first dwelling within the territory of Italy and transfer their residence within 18 months in the Municipality where the real estate is located.
PURCHASE OF PERTINENCES
Provided that all conditions listed above are present, the benefits for the „first home“ can be used for purchase of its pertinences as well, although the purchase is separate from the purchase of the „first home“ (only one pertinence for each cadastral category):
C/2 (cellar o attic);
C/6 (garage o residential closed parking space);
C/7 (shed o residential outdoor parking space).
The properties classified in the cadastral categories can be situated near the main dwelling (anyway not too far and not in the other Municipality).
Spose is a holder in legal communion
In case two sposes, holders in legal communion, purchase an apartment („first home“) but only one of two sposes respects all the conditions required for the benefits (because, e. g., another one had already used this advantages before the marriage), the application of the tax reliefs is of 50%. Holders of a residual life estate (nuda proprietà) Provided that all conditions listed above are present, the holders of a residual life estate can enjoy the banefit, even though a residual life estate is situated in the same Municipality where the „first home“ is situated. Purchase of additional parts of the same property In case all the conditions required respected, the purchaser can use the tax reliefs buying additional parts of the same dwelling (even though he/she is already holder of one of the parts). Moreover the advantage for the same dwelling can be used in the following cases: when the person who has the rights of usufruct, use or housing, purchases a residual life estate (nuda proprietà) of the property; when the holder of a residual life estate purchases the right of usufruct, use or housing. In case all conditions required respected, the purchaser can use the tax reliefs buying an adjoining dwelling: when he/she purchases two adjoining apartments with purpose to construct a unique one (not luxury one); when he/she purchases a dwelling adjoining to another one already bought.
WHEN THE BENEFITS CAN BE LOST:
the information declared in the purchase deed are false; he/she doesn’t transfer their residence within 18 months in the Municipality where the real estate is located; he/she sells the dwelling within 5 years from the moment of the purchase and doesn’t buy another dwelling. However, the law allows a „first home“ buyer to resell the property without incurring any penalty in the event the buyer purchases another property for his/her residential use within one year from the date of the previouse sale. Assessment by „ufficio“ The Revenue Agency (Agenzia delle Entrate) controls the presence of all conditions required within 3 years. In case one of the conditions is missing, the Revenue Agency will send a notification of liquidation to retrieve the taxes.
SALE OF PROPERTY
WHEN THE SELLER PAYS TAXES
Italian resident individuals are subject to income tax on their worldwide income, and are required to pay „personal income tax“ on income derived from thier real estate. Miscellaneous Income – capital gains from disposal of Real Estate asserts. Capital gains arising from sale of real estate properties owned by resident as well as non-resident individuals are taxable only if such properties were purchased less than five years from the date of transfer. Therefore, property kept for more than five years will not give rise to capital gains taxation upon its disposal.
SUBSTITUTE TAX ON CAPITAL GAINS
Since 2006 an alternative system for taxability of capital gains has been introduced. In fact, the seller can choice this substitute tax declaring it in a disposal act.
Tax rates: 12,5% before October 2nd , 2006; 20% after October 3rd , 2006. The notary will impart all the information relating to the application of the sustitude tax to the Revenue Agency.
NEW RULES FOR THE REAL ESTATE DONATION
When an immoveable property in sale is a dwelling received as a donation, a prospective capital gain is taxable if the property was purchased less than five years from the date of transfer. A taxable capital gain is the difference between corresponding of transfer and price of the construction/purchase.
TAX CREDIT FOR PURCHASE OF A NEW „FIRST HOME“
WHO CAN ENJOY IT
When the taxpayer sells a property, which was purchased with tax reliefs for „first homes“ and purchases another dwelling (not luxury) as a „first home“ within one year from the transfer, he/she can enjoy a tax credit. It is equal to the amount of registration tax or VAT paid for the first purchase, and anyway, cannot be higher than the amount of registration tax or VAT paid for the second purchase. The purchaser can enjoy the benefit also if he/she buys the property through a contracting agreement (appalto) or permutation. The contracting agreement must be written and registered. Moreover the purchaser can enjoy the tax credit if he/she bought the first dwelling paying VAT, before May 22nd , 1993 (without tax relief for „first homes“), but not before coming into force of the low no.168 of 1982.
In this case, the purchaser should have had all necessery requirements for the tax reliefs in the moment of buying the first dwelling.
HOW TO USE IT
The taxpayer can enjoy the tax credit in the following ways:
decreasing the registration tax for a new purchase;
decreasing the registration tax, the land registry tax and the cadastral tax presented in the acts and notifications after acquisition of the tax credit; decreasing the „personal income tax“ (Irpef) derived from the declaration. The declaration must be introduced after a new purchase (within one year); as a compensation of other duties and contributions (type F24, using the code of duty 6602). Furthemore, the purchaser must declare his/her will to enjoy the tax credit (indicating if he/she wants to reduce the registration tax for the same purchase deed or not) in the purchase deed for a new property. If this declaration was excised in error, it is possible to attach the declaration to the purchase deed.
WHEN THE PURCHASER CANNOT ENJOY THE TAX CREDIT
when the taxpayer is debared from the tax relief for the „first home“; when the taxpayer bought a previous property without tax relief for the „first home“ (with normal tax rates); when a new property doesn’t have the necessery requirements for „first homes“; when the sold property was transfered to the taxpayer through inheritance or donation excepting the case when all the taxes relating to the transfer were paid.
PURCHASE OF AN IMMOVEABLE PROPERTY AFTER RISTRUCTURING WORKS
When the taxpayer purchases an immoveable property after ricstructuring works he/she can enjoy some tax reliefs as well. In particular, the taxpayer is currently entitled to deduct from his/her „personal income tax“ (Irpef) when he/she purchases a dwelling situated in a ristructured building and restructuring works were done by a construction company or by a construction cooperative.
purchase of dwelling must be occured by June 30th , 2007; ricostructuring works must be finished by December 31th , 2006; ricostructuring works must be related to whole building (not only to a part of it even though this is the part of the purchase). The benefit is related to one dwelling, not to whole building. Due to the decree no. 223/2006 (extended till December 31th , 2006) application of VAT at 10% for ristructuring works depends on the moment of the purchase. Purchasing activity before October 1st , 2006:
In this case taxpayers can deduct from their „personal income tax“ (Irpef) the 41% (calcolated without references to the value of the ristructuring works done) of the 25% of flat rate amount of the purchase price declared in the purchase deed. Purchasing activity after October 1st , 2006:
In this case taxpayers can deduct from their „personal income tax“ (Irpef) the 36% of the 25% of flat rate amount of the purchase price declared in the purchase deed. The deduction is available on expenses incurred up to the maximum limit of €48.000 (in the both cases – the 36% or the 41% of the 25% of the price declared in the deed) on each property on which the works are done and will have to be allocated over a period of 10 years.
For the immoveable properties purchased after October 1st , 2006 the maximum limit of €48.000 must be related to the single property and to the single buyer.
To enjoy the deduction the purchaser must indicate the cost paid on a special field of the income tax return (model 730 or Single model for private individuals – „modello unico“) The amount will have to be allocated over a period of 10 years.
The taxpayers which are 75 and 80 years old can allocate the amount over 5 and 3 years respectively. In that case the taxpayers must be 75 and 80 by December 31th of the year of the tax deduction.