Buying property in Italy from a private seller usually costs less in tax than you might expect, because the main tax is charged on the home's cadastral value, not the price. Registration tax is 9% for a second home and 2% with prima casa relief, with a minimum of €1,000. Buying a new home from a developer works differently: you pay VAT on the price instead.
Key points
- From a private seller: registration tax of 9% (second home) or 2% (prima casa) on the cadastral value, minimum €1,000, plus €50 + €50 fixed taxes.
- From a developer charging VAT: 10% VAT, or 4% with prima casa relief, plus three fixed taxes of €200 each.
- Prima casa needs residence in the comune within 18 months, so most holiday-home buyers pay the higher rate.
- You need a codice fiscale. Non-EU buyers must come from a country that offers Italians the same rights.
- Add a notary and, usually, an estate agent who charges the buyer too.
Buying property in Italy: what it costs
| Cost | Private seller | Developer (VAT sale) |
|---|---|---|
| Main tax | Registration tax 9%, or 2% prima casa, on cadastral value | VAT 10%, or 4% prima casa, on the price |
| Fixed taxes | Mortgage tax €50 + cadastral tax €50 | Registration, mortgage and cadastral taxes, €200 each |
| Notary | Typical fee for the deed, a few thousand euros | Same |
| Agent | Commonly about 3% + VAT, often charged to both sides | Often none if buying direct |
Every cost for your price and situation in Italy, including taxes for buyers from abroad.
Registration tax and the cadastral value
Most private sales of homes to individuals use the prezzo-valore rule. The registration tax (imposta di registro) is worked out on the cadastral value of the home, not the price you pay, as long as you're buying as a private person and you ask the notary to apply it in the deed.
The cadastral value comes from the official cadastral income (rendita catastale):
- Take the rendita catastale and add 5%.
- Multiply by 110 for a prima casa, or 120 for any other home.
For example, a flat with a rendita of €700 has a cadastral value for a second home of €700 × 1.05 × 120 = €88,200. At 9%, registration tax is €7,938, even if the price is €200,000 or more.
The rendita is shown on the property's cadastral record (visura catastale). Ask for it before you make an offer. Our calculator doesn't know the real figure, so it assumes the cadastral value is about 40% of the price. In older town centres it's often much lower, and in newly registered homes it can be higher.
Whatever the cadastral value, registration tax can't be less than €1,000.
Prima casa: the main-home relief
Prima casa relief cuts the tax on buying your main home. According to the national notaries' guide, the main conditions are:
- You buy as a private individual, not for a business.
- The home isn't in a luxury cadastral category (A/1, A/8 or A/9).
- You live in the comune where the home is, or move your residence there within 18 months of buying. Working or studying there also counts.
- You don't own another home in the same comune, alone or with your spouse.
- If you already own a home bought with prima casa relief elsewhere in Italy, you must sell it within two years of the new purchase.
You declare these in the deed. If you don't move your residence in time, you lose the relief and pay the difference plus a penalty. Italian citizens who moved abroad for work can claim relief on a home in their comune of birth or former residence without moving back.
For most British, Irish or American buyers of a holiday home, prima casa won't apply, so budget for the 9% rate.
New builds from a developer: VAT
If you buy a new home from the builder or developer that charges VAT, you pay 10% VAT on the price, or 4% if you qualify for prima casa. Registration, mortgage and cadastral taxes are then fixed at €200 each. Because VAT is on the full price, not the cadastral value, a new build usually costs more in tax than a resale home at the same price. Our calculator covers resale purchases from private sellers.
Worked examples
A €200,000 second home, bought from a private seller
| Cost | Amount |
|---|---|
| Registration tax | €7,200 |
| Mortgage & cadastral taxes | €100 |
| Notary (typical) | €2,800 |
| Total buying costs | €10,100 |
This assumes a cadastral value of 40% of the price. Agent fees would be extra.
A €150,000 home bought as your main home (prima casa)
Registration tax at 2% comes to €1,200, so total buying costs are about €4,100 before agent fees.
A €50,000 village house as a main home
At 2% of the assumed cadastral value, the tax would be well under the minimum, so you pay €1,000. Total buying costs come to about €3,900. On cheap homes the notary and fixed charges matter more than the tax.
Buying in Italy as a foreigner
Codice fiscale. You need an Italian tax code for the preliminary contract, the deed, taxes and utilities. Non-residents can apply at an Italian consulate or at an Agenzia delle Entrate office in Italy with their passport.
Reciprocity. Under Italian law, foreigners enjoy the same civil rights as Italians if their country offers the same to Italians. EU and EEA citizens are exempt from this check, and so are foreigners legally resident in Italy with a qualifying permit. For others, including UK and US citizens, the notary checks reciprocity before the deed. A treaty on investment between Italy and your country can also satisfy it.
The notary. The deed (rogito) must be signed in front of an Italian notary, who checks the title, collects the taxes and registers the sale. Deeds are in Italian. If you don't speak Italian, an interpreter must be present, unless the notary and witnesses speak your language. If you can't attend, you can sign a notarised power of attorney abroad with an apostille.
The process. You usually sign a preliminary contract (compromesso) with a deposit (caparra), which must be registered with the tax office, and then the final deed a few weeks or months later.
Costs after you buy
Second homes pay IMU, the local property tax, each year at rates set by the comune. A main home is generally exempt unless it's in a luxury category. You'll also pay a waste tax (TARI) and any condominium fees. Non-residents may need to declare Italian property income, and your home country may tax it too.
Common mistakes
- Budgeting on the price, not the cadastral value. Get the visura catastale to work out the real tax.
- Assuming prima casa applies. It needs residence within 18 months.
- Comparing new builds and resale homes on tax alone. VAT on a new build is charged on the full price.
- Forgetting the agent. Italian agents commonly charge the buyer as well as the seller.
Tax back home
Buying abroad can create tax to pay and forms to file where you live, not just where you buy.
- UK residents are generally taxed on their worldwide income and gains. Rent from a home abroad goes on your Self Assessment return, and when you sell you may owe UK Capital Gains Tax. You can usually claim Foreign Tax Credit Relief for tax already paid in the other country, so the same income isn't fully taxed twice.
- US citizens and green-card holders are taxed on worldwide income wherever they live. Report foreign rental income on your US return. If your foreign bank accounts together go over $10,000 at any time in the year, file an FBAR (FinCEN Form 114), and you may also need Form 8938 (FATCA) if your foreign financial assets pass its thresholds. A home you own directly isn't reported on Form 8938, but the foreign account you pay through may be.
- Everyone else: check how your country taxes foreign rent and gains, and whether it has a tax treaty with the country you're buying in.
Plan this before you buy, ideally with a tax adviser who knows both countries.
Work out your own figures
Choose main home or second home and enter the price. The calculator estimates registration tax, the fixed taxes and notary costs. Check the result against the real cadastral value once you have the visura catastale.
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