Which value are the purchase taxes calculated on?

When the seller is a private individual and the buyer asks for the price-value rule in the deed, the registration tax is calculated on the cadastral value, which is usually well below the price. When VAT applies, the taxes are calculated on the price.

Can a foreign buyer get the reduced 'prima casa' rate?

Only if the conditions are met: the property is not a luxury category (A/1, A/8, A/9), the buyer does not own another home bought with the benefit, and the buyer transfers residence to the municipality within 18 months of the deed, or works there. A buyer who keeps living abroad does not normally qualify; the agency's or seller's assurances do not change this.

How much does the notary cost?

Notarial fees depend on the price and the complexity of the deed; the notary provides a written estimate in advance, which includes the taxes paid on your behalf. Ask for it before the preliminary.

Do I pay tax every year?

The municipal property tax (IMU) is due on a second home and on a home owned by a non-resident; a main residence where you actually live is normally exempt, except luxury categories. The waste tax (TARI) is due by whoever occupies the property. Rental income is taxed in Italy whatever your residence.

What happens when I sell?

If you sell within five years of the purchase, the gain is taxable in Italy unless the property was your main residence for most of the period; you can opt for a 26 per cent substitute tax paid through the notary. After five years the gain is not taxed in Italy. Your home country may tax it as well, subject to the double tax treaty.

Guide for foreign buyers · Part 2

Costs, taxes and ownership

What a purchase costs beyond the price, calculated on official rates, and what owning, letting, selling and passing on a property in Italy involves.

Part 1: The process, step by step.

Purchase taxes

Rates published by the Italian Revenue Agency, verified in October 2026. The notary collects them at the deed.

Private seller: Registration tax 9% of the taxable value (minimum 1,000 euro), plus 50 euro mortgage tax and 50 euro cadastral tax.
Private seller, 'prima casa': Registration tax 2% (minimum 1,000 euro), plus 50 euro and 50 euro. Only with the residence and other conditions.
Builder, sale subject to VAT: VAT 10% of the price (4% with 'prima casa' conditions, 22% for luxury categories A/1, A/8, A/9), plus three fixed taxes of 200 euro each.
Taxable value: With a private seller the buyer can ask in the deed for the price-value rule: taxes are calculated on the cadastral value (cadastral income × 1.05 × 120; × 110 with 'prima casa'), not on the price. The price must still be declared in full.

Worked examples

Figures rounded. Each case needs its own calculation on the actual cadastral data.

Flat in Bari, private seller, price 250,000 euro, cadastral income 850 euro, no 'prima casa'

Cadastral value: 850 × 1.05 × 120 = 107,100 euro. Registration tax 9% = 9,639 euro, plus 50 + 50 euro. Total taxes 9,739 euro, about 3.9% of the price. Without the price-value request the tax would be 9% of 250,000 = 22,500 euro.

Same flat, buyer who moves residence to Bari within 18 months ('prima casa')

Cadastral value: 850 × 1.05 × 110 = 98,175 euro. Registration tax 2% = 1,963.50 euro, plus 50 + 50 euro. Total 2,063.50 euro.

New villa from the builder, price 400,000 euro, no 'prima casa'

VAT 10% = 40,000 euro, plus 200 + 200 + 200 euro. Total 40,600 euro. VAT is always calculated on the price: the price-value rule does not apply.

Other costs

Who is paid, when and on what basis.

Preliminary contract

Registration within 30 days of signing: 200 euro fixed, plus 0.5% of the confirmatory deposit and of any advance on the price (rule in force for preliminaries signed from 1 January 2025); the proportional amount is credited against the registration tax paid at the deed. Filing in the Land Registry costs a few hundred euro more and is worth it when months pass between preliminary and deed.

Notary

Fees depend on price and complexity. The notary gives a written estimate that includes the taxes he or she pays on your behalf. With the price-value rule, notarial fees are reduced by law by 30%.

Agency

Market practice is a commission of between 2 and 4 per cent plus VAT, payable by each party that gave the mandate, due when the parties reach agreement, not at the deed. Have the amount and the moment of payment in writing before you make the offer.

Surveyor and translation

A technical report on planning and cadastral compliance is a few hundred to a few thousand euro depending on the property. If the deed is bilingual or read by an interpreter, the translation and the interpreter are paid by the buyer.

Lawyer

The firm gives a written quote before the engagement, as Italian professional rules require, with the scope of the checks and the assistance included. Ask any lawyer for the same before you start.

Owning, letting, selling, passing on

Yearly taxes

IMU, the municipal property tax, is due on second homes and on homes owned by non-residents; the rate is set by each municipality on the cadastral value. TARI, the waste charge, is due by whoever occupies the property. Both are paid in two instalments, in June and December.

Letting

Leases must be registered with the Revenue Agency within 30 days. Rental income is taxed in Italy even for non-residents, by ordinary rates or, for residential leases to individuals, by the optional flat tax (cedolare secca). Short lets are subject to further municipal and national rules.

Selling

A gain on a sale within five years of purchase is taxable in Italy unless the property was the seller's main residence for most of the period; the seller can opt for a 26% substitute tax paid through the notary. After five years the gain is not taxed in Italy. The home country may also tax it, subject to the tax treaty.

Succession

Regulation (EU) 650/2012 applies the law of the deceased's last habitual residence to the whole estate, but a foreign national can choose the law of his or her nationality by a will. Italian inheritance tax is due on Italian property whatever the law chosen: 4% for spouse and children over an allowance of one million euro each, 6% for siblings over 100,000 euro each, 6% for other relatives up to the fourth degree, 8% for others, plus 3% mortgage and cadastral taxes unless the heir qualifies for the 'prima casa' benefit.

Questions buyers ask

Which value are the purchase taxes calculated on?: When the seller is a private individual and the buyer asks for the price-value rule in the deed, the registration tax is calculated on the cadastral value, which is usually well below the price. When VAT applies, the taxes are calculated on the price.
Can a foreign buyer get the reduced 'prima casa' rate?: Only if the conditions are met: the property is not a luxury category (A/1, A/8, A/9), the buyer does not own another home bought with the benefit, and the buyer transfers residence to the municipality within 18 months of the deed, or works there. A buyer who keeps living abroad does not normally qualify; the agency's or seller's assurances do not change this.
How much does the notary cost?: Notarial fees depend on the price and the complexity of the deed; the notary provides a written estimate in advance, which includes the taxes paid on your behalf. Ask for it before the preliminary.
Do I pay tax every year?: The municipal property tax (IMU) is due on a second home and on a home owned by a non-resident; a main residence where you actually live is normally exempt, except luxury categories. The waste tax (TARI) is due by whoever occupies the property. Rental income is taxed in Italy whatever your residence.
What happens when I sell?: If you sell within five years of the purchase, the gain is taxable in Italy unless the property was your main residence for most of the period; you can opt for a 26 per cent substitute tax paid through the notary. After five years the gain is not taxed in Italy. Your home country may tax it as well, subject to the double tax treaty.

This guide is general information, updated to October 2026. It is not legal advice and does not replace checks on the specific property and on the buyer's situation. Tax rates and rules can change. Sources: Italian Revenue Agency, "L'acquisto della casa: le imposte e le agevolazioni fiscali"; Presidential Decree 131/1986; Presidential Decree 917/1986 (income tax code), Art. 67; Decree-Law 262/2006, Art. 2; Regulation (EU) 650/2012.