When you buy property in Italy you should pay different fees. These vary considerably according to the price, whether the property is new or old, whether you’re buying via an agent or privately, and whether you have employed a lawyer or other professionals. Most property fees are based on the ‘declared’ value of a property, which is usually less than the actual purchase price or its ‘market’ value.
The fees associated with buying a property in Italy are among the highest in Europe. Fees are usually payable on the completion of a sale. Before signing a preliminary contract, check exactly what fees are payable and have them confirmed in writing. If you’re a resident, the fees associated with buying a property in Italy can be offset against income tax.
Here are the following property fees:
- Registration tax. It ranges between 3 and 7 per cent of the declared value. The amount payable depends on whether it’s your first and only home or a second home.
- Land registry tax. First home resident buyers of new or resale properties pay a fixed fee of 168.00 euro. Buyers of second homes and non-residents pay 1 per cent of the declared price.
- Value Added Tax. Buyers of new properties must pay VAT, which ranges between 4 per cent for first home resident buyers to 10 per cent for second home and non-resident buyers, and 20 per cent on luxury homes.
- Mortgage fees. All lenders charge an arrangement fee for establishing a loan, usually around 2 per cent of the loan amount. There’s a mortgage tax of 129.11 euro for resident first-home buyers and 1 per cent otherwise, and a fee of 0.25 per cent is payable to the notary for registering the charge against the property at the land registry.
- Notary’s fees. Typical fees are 2,000 euro for a property costing 50,000 euro and 3,500 euro for a property costing 500,000 euro plus fees for other services. Fees for a preliminary contract are around half these.
- Legal fees. These usually from 1 to 2 per cent of the declared price of a property or a fixed fee, depending on the amount of work involved.
- Estate agent’s commission. These vary considerably from 3 to 8 per cent and are usually shared equally between the vendor and buyer.