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The buying process in Italy
Having decided on what property to purchase with Silverhouse Property Limited the following steps are taken:
Taxes and costs
Legal costs (as detailed above) should total approximately €2000 but are subject to your choice of legal representation. The taxes and costs detailed below are payable when purchasing a property in Italy:
- The client will send Silverhouse Property a completed reservation form and will organise a payment to go directly to the developer whilst sending a receipt of the proof of transfer to Silverhouse Property; the property will be taken off the market.
- In most cases the client will then organise a short viewing trip to view the plot; if you decide not to proceed upon inspection the reservation is refundable (within 30 days of reservation) and if you do proceed we will reimburse €500 off your costs on the first 50% payment.
- The client is sent a copy of the standard developers contract.
- The client will then (with a local lawer) negotiate agreement on the above-mentioned contract. This can be done with a short trip to Italy, or Silverhouse Property can assist you in finding legal representation to act on your behalf (Power of Attorney).
- The client's lawer will then undergo legal checks on the property and the developer selling the property.
- When all is agreed and checks are complete the contact will be signed and the first 50% paid to the developer with the reservation fee deducted off this.
- Ownership and title deeds are transferred on completion of the development and the final 50% is then paid (Finance is available for this payment if needed).
- Your lawyer then manages registration of property ownership and this usually takes approximately 1 week.
- IVA (VAT) of 10% - this is a compulsory tax and is paid on the final payment (IVA) can be reduced by obtaining residency or buying through a company (please contact for more details).
- Stamp duty (Notary tax) of 2% - Is charged as a percentage of the transaction.
- Mortgage costs - This cost is dependant on whether you need or require finance for the final payment and is approx 1.5%.
Ongoing costs (fixed)
- Community charge of €480 per year.
- Annual tax of 0.4% of the purchase cost.
When selling property in Italy, there are three variables.
- You sell before completion and you are free from Capital Gains tax.
- You sell within 5 years of completion and you are liable for 12.5% Capital gains tax in the country of purchase (you may also have to make up the difference in your country if bringing the money back).
- You sell after 5 years and become exempt from Capital gains tax in the country of purchase.