This information sheet is a service for relations of Basecamp who intend to invest in a second home in Italy. This information is specifically intended for residents of the Netherlands. Please note that different rules apply if you (permanently) live in Italy or other countries, or if you buy this as a company. The information is based on tax figures for 2024. This document is based on our best knowledge, however we cannot guarantee accuracy and always advise consulting to your own tax advisor.

Tax implications of a Second Home in Italy

Below are the main Italian taxes that you will encounter when purchasing, owning, renting out and/or transferring a second home.

 

Taxes for transaction

For each transaction, the following taxes are applicable:

  • Transaction Tax Upon a regular purchase of ownership of a property (a civil house, not being part of a resort), the buyer pays 9% transfer tax on the cadastral value. Additionally, fixed amounts of 50 euros each are owed for mortgage and cadastral taxes. In the case of the Italian property being transferred by gift or inheritance, the recipient(s) owe 2% mortgage tax and 1% cadastral tax.
    For lease contracts, (which is Basecamp’s proposition), no transfer tax is applicable.
  • Registration Tax Lease contracts for real estate must be filed for registration with the Revenue Agency within 30 days from signing date. For real estate, 1% of the amount must be paid, either upfront or yearly, according to how the lease is being paid.
    For Tiny Houses on Wheels (being movable property), no registration tax is needed (unless the contract is to be used in court, in which case a €200 registration tax will be payable).
  • Stamp Duty Depending on the size (number of pages) of the contract, a small amount should be paid. Most probably this amount will be less than 100 euros (16 euros for every 4 written sides of the contract and, in any case, every 100 lines).

 

Capital Gains Tax
  • The text below is only applicable for real estate sales, and not for leaseholder rights.
  • If you sell your Italian property within 5 years at a profit, you must pay 26% income tax on the capital gain. According to the tax treaty between Italy and the Netherlands, Italy may also levy such a tax on residents of the Netherlands. The taxable capital gain is the positive difference between the sale proceeds and the acquisition price, with certain adjustments allowed on the sale price and the purchase price. You can deduct the sale costs from the sale price and add the buyer’s costs and any renovation costs to the acquisition price.
  • In the case of inheritance or gift of the property, this capital gains tax is not owed. For the recipient(s) of the property, a new ownership period begins, with the adjusted cadastral value at that moment serving as the new acquisition price. If heirs sell the property shortly after inheriting it, they do not have to pay capital gains tax, provided that the value has not increased in the period between acquisition and sale.
  • If you sell the property after an ownership period of 5 years or longer, you do not need to pay this tax.

 

Income Tax

For real estate the following applies:

  • It must be noted that income tax is normally due to the country of residence. However, in the case of income deriving from real estate located in Italy, tax is due in Italy. Furthermore, possible conventions to avoid double taxation between Italy and the Netherlands may apply. Please consult your tax advisor in your country of residence.
  • For income tax in Italy, as a natural person, a notional rental (“forfaitaire inkomsten” in Dutch) value applies as income from the Italian home. This fictitious income is derived from the cadastral value. If the property is also rented out, the taxable income is the higher amount of the notional rental value and the actual rental income. When determining the actual rental income, a cost deduction of up to 5% of the gross rental income is allowed. The income tax rate ranges from 23% to a maximum of 43% of net rental revenues.
Income (in euros) Rate IRPEF 2024
0 – 28,000 23%
28,001 – 50,000 35%
50,001 and higher 43%
  • The above rates are increased by a regional surcharge. Additionally, municipal and provincial surcharges apply.  Regional surcharge rate for 2024 is 1,23%, while Sant’Antioco municipal surcharge is 0,7%.
  • Progressive Italian IRPEF is due as a ‘various incomes’ tax category. Subjects not residing in Italy must obtain an Italian tax number and it is advisable they refer to an Italian certified accountant to deal with all tax obligations.

For Tiny Houses on Wheels, income tax is treated differently. Because this is not seen as income from real estate, taxes are not payable in Italy, but in the Netherlands instead.

 

Wealth Tax

Italy does not levy a wealth tax.

 

Property Tax

At the municipal level, property tax is levied. The basis for the levy is the cadastral rental value plus 5%, multiplied by a factor between 55 and 160.

  • Municipal Property Tax (IMU) In Sardinia the IMU tax is due by Basecamp Operations and is calculated as a percentage of the total value of the resort. This percentage (decided by the municipality from year to year, currently 0,86%) of a value given to the entire resort by the Revenue Agency. These costs will be cross-charged (implicitly, as part of the park fees. By law, the corresponding amount can only be charged on the rental fee) by the resort (Basecamp Operations) to every Tiny House based on the surface of the Tiny House/plot.
  • Waste Tax (TARI) Tari is due by BSO and is calculated as a percentage (decided by the municipality from year to year) of a value given to the entire resort by the Revenue Agency (cadastral value). The costs will be cross charged to every Tiny House based on the surface of the Tiny House/plot.

 

Inheritance Tax

If a person who is not a resident of Italy leaves behind a property located in Italy, Italy can levy inheritance tax. Debts related to the Italian property reduce the tax base. In principle, the actual value of the property is the starting point, but if the adjusted cadastral value is lower, this value can be used. Italian real estate with a special cultural value is partially exempt under certain conditions. Please note this is only applicable for real estate properties, not for leaseholder rights.

  • The rate of the Italian inheritance tax depends on the relationship with the deceased:
Heir Rate Tax-Free Amount
Spouse, children, grandchildren 4% €1,000,000 per person
Siblings 6% €100,000 per person
Other relatives up to the fourth degree and in-laws up to the third degree 6% No tax-free amount
All others 8% No tax-free amount

 

 

 

 

 

 

 

  • In the Netherlands, there is no tax treaty with Italy to prevent double inheritance tax. However, the Netherlands will (under conditions) grant a reduction on the Dutch inheritance tax that is attributable to the Italian property. This means that Dutch inheritance tax is reduced by the amount of the Italian inheritance tax.

 

VAT (“btw”)

VAT when buying or leasing a property

  • In short, for real estate sales (being either newly built or existing) no VAT is applicable. However, a levy of 22% is an option, if desired by the seller.
  • For lease of either real estate or movable properties, such as Tiny Houses on Wheels, VAT is applicable.
  • If the buyer or leaseholder buys the Tiny House as a business (having a VAT registration in country of residence) for business reasons (as an investment, “buy to let”), the transaction is a so called ‘intra UE B2B transaction’ and VAT does not apply (Basecamp issues an invoice with no VAT exposed and the tenant accounts the invoice with reverse charge in their country “btw verlegd”).

VAT when renting out the property

According to the Management Agreement, Basecamp will rent the Tiny House/Tiny House on wheels to the clients applying the VAT due by law (currently 10%) for accommodation business. As VAT is neither a revenue nor a cost, it must not be considered to determine the income generated by the Tiny House/Tiny House on wheels.

In short:
for leasing a Tiny House, fixed to the ground (real estate), the following applies:

  • No transaction tax (because it is lease, no change of property)
  • No inheritance tax
  • No wealth Tax
  • 1% registration Tax
  • <100 euro for stamp duty
  • Income tax:
    • Dependent on Italian income and personal circumstances:
    • Probably around 23% of net rental revenue.
    • Tax must be declared in Italy, so a local tax office would be advised
  • Property Taxes will be charged by Basecamp as part of park fees
  • VAT depends on the situation of the investor:
    • Invest as a natural person, resident in the Netherlands: Basecamp in Italy will charge VAT and this VAT must be paid and VAT is not refundable
    • Invest as a business, based in the Netherlands (or another EU country): Basecamp will not levy VAT, but the client should declare the VAT in the Netherlands (or another EU country), and will need a VAT number before we do the transaction. Also, for rental income, VAT should be declared to authorities in country of residence (“btw verlegd”)
    • Invest as a business, based in Italy: you need to start and register a local company and Basecamp in Italy will charge VAT, and client may get a refund within Italy, but this could take 3 years, depending on specific situation)

Please note: the choice for one of the above options, is a choice that the investor must make. The decision must be based on the personal situation.

Basecamp strongly advises seeking professional and individual advice on how to invest and deal with all tax obligations.

Sources and interesting links


Tax advisors in Italy

https://www.bachis.it/it/