ITALY- COUNTRY OVERVIEW
Italy remains an extremely tempting prospect for those looking to invest in property abroad, with a number of factors behind its sustained popularity. Although there are many Tuscan villas and farmhouses selling for seven figure sums, there are still plenty of bargains available off the beaten track. The market offers something for everyone, from rustic rural getaways and seaside villas, to Renaissance city apartments and modern ski chalets. Italy enjoys an easy-going pace of life with a strong emphasis on friends and family. The property market is well-regulated and there are plenty of English speaking agents, lawyers and surveyors.
Emerging regions include Puglia, Le Marche, Abruzzo, Sicily and Sardinia, however traditional favourites such as Tuscany and the Lakes perform the strongest.
Italy and the UK have a double-taxation agreement – meaning the same income is never taxed by both governments. Who you pay tax to depends on where your principal residence is, where your income originates and what your nationality is. If you are deemed non-resident in the UK then full exemption is granted from UK taxation. The tax year in Italy ends on 31st december. Income tax on Italian source earnings operates in the same way as PAYe here in the UK – payments are made by yourself or your employer on a monthly basis. earnings up to €15,000 are taxed at 23% increasing to a maximum of 43% on earnings of €75,001 and over. IVA (equivalent to VAT) varies from 4% to 21% depending on the commodity.
KEY LEGAL ISSUES
The Italian legal system is highly bureaucratic and can be a minefield for foreign buyers, so independent legal advice is crucial. Contact a notaio to oversee the purchase, who will draw up the deeds, ensure the legitimacy of the seller and register the transfer of the property. Notaios are required by law to remain impartial, and therefore are unable to offer advice, verify the accuracy of statements made in the final contract or point out possible pitfalls in a contract. This makes it imperative that you appoint an independent lawyer to ensure your interests are protected. You will need to sign a preliminary contract known as the compromesso and obtain a codice fiscale (fiscal code number). once this is complete the notaios will meet to exchange contracts and the title deed known as the rogito. The rogito must then be registered at the local catastro (land agency).
• Visit the region in colder months before you buy, so you can see what life is like all year round.
• Always seek independent legal and financial advice before buying.
• Always employ a geometra (a sort of combined architect and surveyor) ideally one who speaks english, to carry out a thorough survey of the property before you buy.