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The buyer's guide If you take things step-by-step, you will soon be holding the keys to your own home Buying a home in Italy is a simple and safe procedure, governed by laws to protect both parties. there are three stages in the process: 1. Making an acceptable offer 2. A formal agreement, known as the Compromesso 3. The final legal tranfer, known as the Rogito or Atto Notarile BUYING THROUGH AN AGENT Altough it is possible to buy a home without using an agent, if you are a foreign buyer you are likely to find thet an English-speaking agent will offer valuable support and ad vice in return for his fee. Agents in Italy usually represent both buyer and seller, charging each about 3% though the fee is negotiable. OFFER (Offerta o Impegnativa di acquisto) As soon as the price, the land boundaries and details of the property have been established, as well as the terms of payment, you will be asked to pay a security deposit, usually between 3.400 and 6.700 puond in the event of breach of contract, to be paid means of cheque or bank money transfer as free trust deposit in the hands of the representative of the agency. This amount will be given back free of any penalty or indemnity, in the case of the seller not accepting the offer. Should the seller accept this offer, the amount will become a binding deposit, called the "caparra confirmatoria". with the building regulations in force and that all taxes have been paid. PRELIMINARY CONTRACT (Compromesso) The datails of the The details of the contracting parties, the details and price of the property, the methods of payment, the dates for signing the final contract and any other clauses that might be relevant will be fixed in this legally binding, private contract between the two parties. In this contract the full price being paid for the property is stated. We recommend that this be done with the assistance of an expert (Public notary, lawyer or real estate consultant) who will perform a title search and insure that there are no loans, liens, or other impediments such as rights of way on the property, that the property is the exact one that is for sale and that all permits and permission for the building are in order. the value of the property and the amount of money the Vendor aims to sell the property for) and the Compromesso has been signed, both parties are legally bound to complete. Geometra You might want to hire a "geometra" to collect all relevant documents. required prior to the sale. After signing the Preliminary Contract you should obtain the necessary documents for the signing of the Final Deed: Tax ID (Codice fiscale) Purchaser is still in Italy.
FINAL DEED (Rogito o Atto notarile) After the signing of this contract there is a period of approx. Three weeks before the new owner receives this document. (or their nominated representatives) must be present at the signing of the Final Deed. This final contract has to be made in front of the Public Notary. This is the contract which is registered in the Agenzia del Territorio Servizio di Pubblicità Immobiliare. Ali government taxes and fees are calculated on the declared value as stated in this contract. The Notary is bound by law to re ad aloud the contract to the interested parties. Prior to the actual signing, the balance of the purchase price is handed over to the Vendor. The Deed is signed by the Vendor and by the Purchaser and is then countersigned by the Notary. At this stage the taxes (imposta di registro or IVA, ipotecaria, catastale) are paid there and then in the notary's office. FIRST HOME (Prima Casa) if you will be living permanently in the purchased property within 18 months from the date of purchase, you can declare this when signing the final deed, which will reduce the taxes on the property from 7% to 3% (imposta di registro) or from 10% to 4% (IV A) plus a fixed tax of about 230 pounds (imposta ipotecaria, imposta catastale) or 340 pounds (IV A). the Notary that he or she understands the contents of the Final Deed. Alternatively, most Purchasers give a special power of attorney (Procura speciale all'acquisto) to their Agent. This document can either be prepared or signed in front the Notary while the Purchaser is stili in Italy, or alternatively, at the Italian Consulate in the Purchaser's country of residence. At the time of the signing of the Final Deed the following fees are to be paid: the Notary's fee. RESPONSIBILITIES OF THE BUYER Estimated costs at time of transfer of deed: AFTER THE PURCHASE Taxes - Local Coucil Taxes Italy has low taxes compared to most countries. Home insurance is not obligatory. In Italy it is the property owner's responsability to contact an accountant to determine the yearly tax bilI. property (paid in two instalments during a year).There is a local rubbish collection tax. Capital Gains Tax the owner used the property as "a main residence" for a period longer than half the time that passed between the purchase and sale of the property. DOCUMENTS REQUIRED I/D Passport - Tax ID (Codice Fiscale) This document can be either be prepared at the italian Consulate in the Purchaser's country of residence or alternatively, while the Purchaser is still in Italy. HOMEOWNER COSTS ENEL (Electicity) General guideline/hypothesis regarding electricity costs, at 4,5 kWh
choose the most convenient solution for you.
ITALIAN PURCHASE TAX Explains the changes in the purchase tax as the Italian Government toughens its stance against tax evasion, which is fast After having looked at these figures it is not surprising that one of the main objectives of the new Italian Government is that of cracking down on tax evasion. Property has always been seen as a sign of wealth and property transactions are easily traceable, Therefore, it is not difficult to understand why some of the new previsions issued by the legislators are focused on regulating the transfers of title and the capital gains generated by these transactions. Although many of these provisions have been heavily criticized in Italy, the reality is that they were necessary to address the issue effectively and some of them must be seen positively. I will try to highlight the most interesting ones for British Buyers. First of all, the new Budget Act 2006 rules that taxes on purchases of property can be paid on either the purchase price or the so-called revaluated cadastral value of the property, i.e. the value which the local "catasto", the Italian building and land registry, gives to the property. The cadastral value is based on the characteristics of the property such as its location, classification, use, total square meters or number of rooms etc. Until January 2006, it was common practice to "under declare" the purchase price on the notary deed. Vendor and buyer would agree on the value to declare, which was usually the one indicated by the "catasto", with the result that the difference between the sum paid and the one declared was often paid in cash so to avoid any further checks from the tax authorities. With the new law, approved on 23rd December 2005 and applied from January 2006, it is now the rule to simply pay the taxes based on the cadastral value of the property. On the deed of sale, however, full purchase price must al so be declared; the method payment and receipts of the deposit paid must also be mentioned on the deed, in addition to the commission charges paid to the estate agent. The same law establishes that payments are to be made either by bank transfer or banker drafts. These changes in the law certainly have some benefits for the buyer, not only payments and the purchase price can be declared openly without the need to pay considerable amounts in cash, but also notaries must apply a discount of 20% to their standard lees. The only disadvantage is that il a vendor wishes to sell his property within 5 years from the purchase, he will be subject to the capital gains tax, which is determined by the difference between the purchase price and the sales price. The capital gains tax, amounting to 20%, was easily avoided when the practice of under declaring was widely the spread, whereas nowadays it is more difficult if not virtually impossible to hide the money earned from the sale of a property.
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R.E.PORTAL - Estate Intermediation Group
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