Does anyone out there rent out their non-Italian home whilst being resident in Italy? I’ve just got a letter from the Agenzia delle Entrate saying I have to declare overseas income, and I guess that includes UK rent. I rent my UK home out for unde
I am looking to buy a property in Tuscany (currently based in Milan) and have run into a series of complications that I'm hoping someone will have some experience of.
Thanks for your comments Arty.My understanding was that yes, I am liable to pay tax in the UK. I could be wrong, but I always thought that you paid tax locally on any assets in that country (maybe unless you change your domicile (?), but I haven't done that).I fill in a return &c, but my personal allowance there easily covers the gain. So I don't have any UK tax paid to offset against any Italian tax payable.My problem is that the Italian tax calculation is on a much more punitive basis. If my understanding is right, it seems totally unfair as it will ignore my actual costs on the property and makes me pay tax out of money I've never received!
Thanks to you both for taking the time to provide your thoughts. Some very helpful suggestions that will discuss with lawyer/vendor. Gives me some hope that the situation can be resolved.
Ram - many thanks for your most helpful replies.The company is an Srl, sadly.From the paperwork we have, it seems the vendor of the property inherited it many years ago, transferred it into his family business (an srl), which got into trouble. Hence the ipoteche giuridiche, I guess.Srl No1 went into liquidation, and the vendor (as liquidator), transferred it to Srl No2, where it currently resides. This was a private act, but agreed with the principal lender who had previously tried to repossess the property.The vendor is the amministratore delegato of Srl No 2.The problem I have is that our lawyer has looked at the paperwork to date and said that there will be a big legal bill if we want her to carry on with the acquisition, plus the cost of visure as you say, and geometra searches.Consequently, we only want to go ahead if we can be reasonably comfortable that the process won't hit an iceberg. Because, understandably, we will not want to complete unless we can be more or less 100% sure that there are no valid claims over the property (looking around this forum, I see plenty of warning signs about liabilities following the property rather than the people).GIven the situation, is it likely we can achieve such a certainty, or better to give up now?
Many thanks Ram for your comments - will ask the vendor for the visura ipoteche, we haven't got a Notary yet pending resolving these issues. When we appoint one, will definitely make sure they intend to act as you suggest.Re your last comment - the vendor is actually a company rather than an individual. Can we do a visura on a company? And do we need to do visure on previous owners?
Thanks KarenThe charges are registered to 3 different banks, and it looks as though there were bankruptcy proceedings in the past against companies owned by the vendor.So from your comments, though I appreciate based more on UK law, it would seem that these banks have probably attempted to claim ownership of the property to compensate defaulted loans. In which case there would be either legal proceedings or a resolution between the parties.As they were registered some time ago, I'm assuming the latter, but that noone ever registed to "downgrade" the charges over the property.Under Italian law, is this likely to be complicated to sort this out?
But isn't a debt is on the property in the UK too? If the Land Registry in the UK made a mistake and transferred a property without a deed of cancellation from a lender, it might well be the same result there. So the difference would seem to be that it's more common for notaries to make a mistake than the Land Registry!I guess that could mean either not picking up on all the outstanding charges, or that the time delay between a lender registering a charge and it appearing on a database of some sort is long enough that the property could be sold in the meantime.Hence Ram's tip about frogmarching the notary to register the deed of transfer, which I will bear firmly in mind.
Many thanks to Adriatico and Ram for the information. It will be invaluable if we do eventually go ahead with the purchase. Though I have to say I'm a lot less convinced about it than I was yesterday. The idea of an irate lender, previous owner or tax official turning up on the doorstep to claim the property would keep us awake for years to come!You have been a great help.
Many thanks for your reply. I am trying hard to justify not walking away as we love the property, but its not easy. There is an agent involved, but they are close to the buyer and consequently I hesitate to trust them 100%.Your comments are not disimilar to our avvocato's re the ipoteche on the house. I just find it hard to comprehend that if a) the buyer represents that the property is to be transferred free of charges and b) the notary confirms that all know charges have been extinguished, that someone could come along afterwards, claim the property to cover unpaid loans and walk off leaving me with nothing. Can that really happen? And if so is any transaction safe?
Comments posted
Thanks for your comments Arty.My understanding was that yes, I am liable to pay tax in the UK. I could be wrong, but I always thought that you paid tax locally on any assets in that country (maybe unless you change your domicile (?), but I haven't done that).I fill in a return &c, but my personal allowance there easily covers the gain. So I don't have any UK tax paid to offset against any Italian tax payable.My problem is that the Italian tax calculation is on a much more punitive basis. If my understanding is right, it seems totally unfair as it will ignore my actual costs on the property and makes me pay tax out of money I've never received!
Thanks to you both for taking the time to provide your thoughts. Some very helpful suggestions that will discuss with lawyer/vendor. Gives me some hope that the situation can be resolved.
Ram - many thanks for your most helpful replies.The company is an Srl, sadly.From the paperwork we have, it seems the vendor of the property inherited it many years ago, transferred it into his family business (an srl), which got into trouble. Hence the ipoteche giuridiche, I guess.Srl No1 went into liquidation, and the vendor (as liquidator), transferred it to Srl No2, where it currently resides. This was a private act, but agreed with the principal lender who had previously tried to repossess the property.The vendor is the amministratore delegato of Srl No 2.The problem I have is that our lawyer has looked at the paperwork to date and said that there will be a big legal bill if we want her to carry on with the acquisition, plus the cost of visure as you say, and geometra searches.Consequently, we only want to go ahead if we can be reasonably comfortable that the process won't hit an iceberg. Because, understandably, we will not want to complete unless we can be more or less 100% sure that there are no valid claims over the property (looking around this forum, I see plenty of warning signs about liabilities following the property rather than the people).GIven the situation, is it likely we can achieve such a certainty, or better to give up now?
Many thanks Ram for your comments - will ask the vendor for the visura ipoteche, we haven't got a Notary yet pending resolving these issues. When we appoint one, will definitely make sure they intend to act as you suggest.Re your last comment - the vendor is actually a company rather than an individual. Can we do a visura on a company? And do we need to do visure on previous owners?
Thanks KarenThe charges are registered to 3 different banks, and it looks as though there were bankruptcy proceedings in the past against companies owned by the vendor.So from your comments, though I appreciate based more on UK law, it would seem that these banks have probably attempted to claim ownership of the property to compensate defaulted loans. In which case there would be either legal proceedings or a resolution between the parties.As they were registered some time ago, I'm assuming the latter, but that noone ever registed to "downgrade" the charges over the property.Under Italian law, is this likely to be complicated to sort this out?
But isn't a debt is on the property in the UK too? If the Land Registry in the UK made a mistake and transferred a property without a deed of cancellation from a lender, it might well be the same result there. So the difference would seem to be that it's more common for notaries to make a mistake than the Land Registry!I guess that could mean either not picking up on all the outstanding charges, or that the time delay between a lender registering a charge and it appearing on a database of some sort is long enough that the property could be sold in the meantime.Hence Ram's tip about frogmarching the notary to register the deed of transfer, which I will bear firmly in mind.
Many thanks to Adriatico and Ram for the information. It will be invaluable if we do eventually go ahead with the purchase. Though I have to say I'm a lot less convinced about it than I was yesterday. The idea of an irate lender, previous owner or tax official turning up on the doorstep to claim the property would keep us awake for years to come!You have been a great help.
Many thanks for your reply. I am trying hard to justify not walking away as we love the property, but its not easy. There is an agent involved, but they are close to the buyer and consequently I hesitate to trust them 100%.Your comments are not disimilar to our avvocato's re the ipoteche on the house. I just find it hard to comprehend that if a) the buyer represents that the property is to be transferred free of charges and b) the notary confirms that all know charges have been extinguished, that someone could come along afterwards, claim the property to cover unpaid loans and walk off leaving me with nothing. Can that really happen? And if so is any transaction safe?