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Buying as first home in Italy

buying as first home


As already discussed in our previous newsletter the taxes when transferring a property, are always paid by the buyer. The buyer can choose if buy as First home or second home, buying as First home means that the property is (or will be) your residential property, in this case you will pay a cheaper notary fee and less yearly taxes.

From the 1st January 2014, the current legislation provides for the application of the VAT to 4% (usually applies 10%) in the case of purchase by a building company, mortgage and cadastral taxes are a fixed amount of € 200 each.

If the purchase is between individuals, it is expected to pay a reduced stamp tax of the 2%, and fixed mortgage and land taxes amounting to € 50 each.

The benefits of buying as first home can be extended to one of the appurtenances:

a garage (cadastral category C / 6);

a canopy (cadastral category C / 7);

a cellar (cadastral category C / 2).

The benefits are also applicable in the case of construction of the first house, or reconstruction, if the original property is demolished.

The requirements for receiving the benefits of the first house are :

  • does not possess, in the same municipality, another property suitable to be used as main house, not even in communion with the spouse;

  • is not entitled to rights of use, usufruct, habitation on another property in the same municipality;

  • not holding, in whole or in shares of other property throughout the country, for which has already benefited from the concessions;

  • the property is located in the municipality in which the buyer has established or will establish his residence within 18 months of purchase, or in which it does business;

  • the property purchased is not considered a “luxury” property (that is not a part of cadastral categories A / 1, A / 8, A / 9).

These conditions shall be met all the time of purchase, and must be declared to the notary, who transcribes the act of buying and selling.

Decline of the benefits

The absence of one of the conditions listed above undermines the right to tax relief, and determines the application of the ordinary taxes, with a penalty of 30% of the outstanding amount.

Even the sale of the property within 5 years of purchase is due to loss of the benefit, if the buyer does not provide, within one year, to repurchase another property intended to dwelling house.

Buying as first home in Italy