Eligibility Requirements, Applicable Tax Relief, and Key Compliance Considerations
For Italian and foreign citizens who have emigrated and transferred their residence abroad, there is the possibility to purchase a first home in Italy by benefiting from the “first home” tax relief, namely by paying registration tax at the rate of 2% (instead of 9%), or, where the property is subject to VAT, by applying a 4% VAT rate (instead of 10%), pursuant to Legislative Decree no. 69/2023, Article 2.
The required conditions are as follows:
- The individual must have transferred abroad for work-related reasons and must have previously resided in or carried out his or her professional activity in Italy for at least five years.
- The individual must not own other residential properties throughout the national territory for which the “first home” tax relief has already been claimed, or must sell such properties within one year.
- The individual must not own another residential property in the same municipality where the tax relief is being requested.
- The purchased property must not be classified as a luxury property (therefore excluding cadastral categories A/1, A/8, and A/9) and may be located in any municipality in which the purchaser resided or worked prior to transferring abroad, not necessarily the last one (Ruling no. 28/E/2025).
- In order to benefit from the “first home” tax relief, the purchaser is generally required to transfer his or her residence to the purchased property within 18 months from the date of the deed. However, in the case of a purchase by an Italian citizen who has transferred his or her residence abroad for work-related reasons, this requirement does not apply, provided that a self-certification is issued at the time of purchase. In the absence of such self-certification, it is possible to amend the deed within the following 18 months, provided that this does not interfere with the assessment activities of the Italian Revenue Agency (Ruling no. 333 of 2020).
Improper application of the tax relief results in the loss of the benefit, with the consequent payment of the difference between the ordinary tax and the reduced tax, as well as a penalty equal to 30% of the additional tax due, plus late-payment interest.
If you wish to receive further assistance on this matter, feel free to contact our Legal Team.
This article was written by Barbara Burroni.
