Clarify IVA on (a normal) house purchase

03/08/2010 - 08:13

Hello all, I was hoping someone could clarify the IVA to be paid on a normal/regular house/appartment purchase (ie not a new build or agricultural/farm etc) - as I am getting conflicts on opinion. Firstly I hear that there's two different rates of 4% (for resident) and 10% (for non-resident). However according to other information I have found is that according to European Law, member states cannot charge different tax percentages to non-residents - as this is deemed discriminational. (I remember Volkvagen getting heavily fined a few years back for charging more to Austrians buying in Germany, than they did to German residents.) We are currently looking at purchasing a property in the Marche region (please see my previous post for the terrible story attached to that one !!) Anyway, my wife is italian and I am told that she just needs to sign something at the consulate here in London, which will effectively ensure we are charged only the 4%. If someone out there would like to shed some light on what exactly i can expect to pay Iva-wise.   Thanking you all in advance



What you are describing is house purchase tax (like UK stamp duty). There is only VAT payable if you buy a new property or buy from a company. The 4% and 10% do not apply depending on whether you are resident or not. You can pay 4% if you choose to designate the property as your "Prima casa" or main residence. This will necessitate you obtaining residency in the comune in which the property is sited within 18 months of the purchase date. You will not be able to claim residence via the consulate abroad, so I can't imagine what the consulate is getting her to sign that entitles your wife to pay only 4%. That does not sound correct to me. If you fail to claim residency within 18 months then the tax man will come after you for the difference plus fees and interest (he definitely will - believe me!). There are other circumstances where it is not possible to claim prima casa benefits (e.g. the property is classed as luxury). The notary or your lawyer should be able to clarify whether your property qualifies.

  As Penny says, you are talking about 'stamp duty' here, and not IVA. However, your wife, as an Italian citizen (assuming she is inscribed on AIRE), is entitled to buy a 'prima casa' paying 4% 'stamp duty', even if she retains a primary residence outside Italy. The Italian consulate should be able to explain this, or go to the agenzia delle entrate site and read their pretty clear FAQ on 'casa'. It is nothing to interest the EC about discrimination: an Italian buying a 'seconda casa' will pay 10% just the same as a UK buyer. A UK buyer moving completely into Italy will pay 4% as 'prima casa', just as an Italian. The situation of an Italian citizen inscribed on AIRE is a bit special - a concession to Italians working abroad. That's all.

I am an Italian citizen living abroad and, when I bought our one and only house in Italy, I wrote a letter to my notary saying that, as a registered AIRE citizen (Anagrafe degli italiani residenti all’estero), I was invoking my right to buying the house with the lower tax rate. Actually, it ended up being a little more complicated because I SHOULD have handed it over to the notary at the atto but wasn’t aware of this and then sent it on later. Serious mistake...because in the meantime, the tax people in Perugia decided that, since I hadn’t taken up residence within the stipulated 2-year period, they were going to charge me the extra tax PLUS a fine for all the years up to and including the one when they sent me the fine – it all came to about €4000 which I did not have handy.  However, I am not Italian for nothing! I found a commercialista who, for the princely sum of €250, was more than ready to take on the Perugia tax office and he fought them for 3 months – when he decided to take them to court, they backed down fast and I now have a letter from them which accepts my status as originally declared and the fine was cancelled.   A little note: as an AIRE member, this means I don’t pay the annual ICI tax but my English husband does…However, my commercialista says this may change when the house is finally declared abitabile and is re-valued from farmhouse to villa. We’ll see.