Expert legal advice on Italian municipal property taxes
ROME- Italian lawyer Giandomenico De Tullio explains the intricacies of the municipal taxes concerning Italian properties.
Starting from year 2014, the new Municipal tax is called IUC (Single Municipal tax).
It consists of three separate taxes, more specifically:
IMU: tax on possession of real estate assets. This does not apply anymore to properties where the owner sets his main residence.
TASI: is the tax financing the services provided by local administrations (such us public lighting, maintenance of roads etc). It is connected with possession, under any legal title, of Italian properties.
TARI: is the tax concerning waste management; This is due by any individual occupying or simply using a property which could potentially produce wastes.
Such taxes do not have uniform rates applying to the whole Italian territory, but can vary, within limits set by the law. This means that mayors have some margins of discretion when applying them. As a natural consequence they must be assessed in each different Municipality.
Properties where owners have officially set their main residence are exempted from the payment of this tax unless classified as luxurious dwellings (cadastral cat. A1, A8 and A9).
All individuals owning properties on the Italian territory are called to pay this tax. The same obligation falls on individuals entitled to real rights such us usufruct or right of use.
The same obligation falls on parties who have inherited an Italian property. Whoever inherits an Italian property should pay this tax from the day of the decease of the former owner. Even if time to lodge a statement of succession is one year since the decease, the debts are transferred to the heir immediately.
This tax applies both to urban and rural building, rural and buildable land.
As previously mentioned, properties classified as “main residence” will be exempt from such tax. The only exception will be represented by luxurious properties, under cadastral classification A1, A8 and A9.
In order to be entitled to the exemption it is necessary having the official residence in such property and live therein on a regular basis.
According to IMU rules also subject to the exemption are the appurtenances of the main residence, such as:
Cellars, storage rooms ( cadastral classification C2);
Car box (C6);
The Municipalities have the right to exempt from the payment of IMU properties owned by Italian citizens resident abroad, under condition that they are not rented out.
DEADLINES FOR PAYMENT
IMU can be paid in two instalments of same amount:
– First one to be paid before 16 of June;
– Second one before 16 of December;
As previously mentioned this is the tax concerning municipal services for general use such us public lighting, road maintenance etc.
WHO SHOULD PAY IT?
Whomever has possession under any legal title of:
- buildings (including properties used as main residence)
- buildable land;
It is irrelevant for what purpose such properties are used.
Rural lands are exempted.
When the property is rented out, the tenant should pay the quota established by the Municipality (ranging between 10% and 30% of the full amount). The balance (ranging between 70% and 90%) should be paid by the landlord;
Each Municipality can offer reductions for:
– Dwelling with a single occupant;
– Holiday homes;
– Dwelling occupied by individuals residing out of Italy for more than six months a year;
– Rural buildings used for residential purposes;
WHEN TO PAY IT
It should be paid in two instalments, the first one before the 16 of June, the second one before the 16 of December.
The two instalments can be of different amounts (opposite to IMU).
It must be highlighted that 71% of Municipalities have postponed the payment of the first instalment to the month of September 2014.
It is the tax concerning waste management. It applies to any party possessing, under any legal title, properties which can potentially produce wastes.
Unroofed surfaces are exempted from the payment of this tax considered appurtenant or annexed to taxable properties and also condominium surfaces.
The floor area is considered as taxable. Some Municipalities have aligned their data base to the cadastral ones, in such case the tax is determined on 80% of the cadastral surface.
Municipalities can deliberate for specific reductions.
Just as example this can be applied to properties with a single occupant, or holiday homes used for a limited period of time.
Each Municipality will establish the number of instalments for payments and the connected deadlines.
Please note, any statement made in this article is intended to be a general practical introductory
explanation only and not formal legal advice. This firm accepts no liability or any responsibility
for any statement made.
De Tullio Law Firm
ABOUT THE AUTHOR
De Tullio Law Firm is an international Law Firm based in Italy and the UK specialising in advising property buyers worldwide and providing legal support to expats on all aspects of residential and commercial property law and in dealing with cross-border inheritance matters in Italy, wills and probates.
De Tullio Law Firm is listed on the websites of the British and American embassies. Giandomenico De Tullio is a full member of STEP (Society of Trust and Estate Practitioners), the leading worldwide professional body for practitioners in the fields of trusts, estates and related issues.