Read news from:
Austria
SHARE
COPY LINK
For members

PROPERTY

Budget 2022: Which of Italy’s building bonuses have been extended?

Since the Italian government made the 2022 budget into law, many reforms to Italy's various building bonuses have been extended or changed. Here's what those planning to build or renovate need to know.

Published: 29 October 2021 13:07 CEST
Updated: 18 January 2022 11:18 CET
Italy's 2022 budget has changed change building projects for homeowners in Italy.
Photo by MAX BEDENDI on Unsplash

The Italian government announced its raft of budget measures for 2022 at the end of last month, effective from January 1st, including tax and pensions reforms, help with household bills and funds to close the gender pay gap.

What particularly stood out for those buying and renovating property was the highly anticipated news on extensions to tax breaks for home renovations.

After much discussion over the last few months of 2021, the authorities confirmed how the various building bonuses will be rolled on and who is eligible to access them, as published in the final Budget Law (Legge di Bilancio) on December 30th, 2021.

EXPLAINED: What changes in Italy’s new budget?

To encourage investment in construction and increase energy efficiency and seismic resilience of existing buildings, the Italian authorities have continued the bonuses for building renovations, energy upgrading, the purchase of furniture and household appliances and the green bonus.

Many of them have been extended to 2024 – however, different deadlines to claim now apply.

Here’s an overview of the building bonuses for 2022 and how they’ve changed.

Renovating Italian property with bonuses.
The superbonus 110 is due to expire next June for single family homes. Photo: Sensei Minimal/Unsplash

The superbonus 110

Italy’s government launched the ‘superbonus 110‘ in May 2020, one of various measures aimed at boosting the Covid-hit economy.

Offering homeowners up to 110% deductions on expenses related to energy upgrades and reducing seismic risk, the scheme has been so in demand that homeowners are stuck amid delays on many projects as construction companies struggle to keep up.

After much speculation and concern as to how this building bonus would continue into 2022, the superbonus on single-family homes has been approved for the whole of this year.

READ ALSO:

The previous caveat has been scrapped. Now there’s no reference to only being eligible if it’s your first home and if you have an ISEE (the social-economic indicator of household wealth) of €25,000 maximum.

The only requirement is that 30 percent of works must be completed by June 30th 2022.

Condominiums, owners of buildings consisting of two to four units and third sector organisations will be able to take advantage of the benefit until 2025, with a sliding scale: 110 percent remains valid until 31 December 2023, dropping to 70 percent in 2024 and 65 percent in 2025.

Italian property renovation.
Photo: reisetopia on Unsplash

Facades bonus

Another bonus extended for 2022 is the Bonus Facciate. This scheme previously allowed you to deduct 90 percent of the amount incurred for renovating the exterior facades of buildings, with no maximum spending limits.

In spite of some initial uncertainty, the facade bonus has been extended again – although in 2022 the percentage of the deduction for restoration work on external facades has dropped to 60 percent.

There are still no maximum spending limits for 2022 for works carried out on the restoration and recovery of external facades, balconies and railings of buildings. This applies to both independent houses and condominium buildings located in historic centres, suburbs and both large and small municipalities.

This bonus has so far been extended until the end of December 2022.

The furniture and appliances bonus

The state aid available for buying household appliances – the Bonus Mobili e Elettrodomestici – has been rolled on until 2024.

The Budget Law 2022 has doubled the maximum amount of eligible expenditure to what had been discussed, now standing at €10,000.

READ ALSO: How to stay out of trouble when renovating your Italian property

This scheme applies to household goods of at least A+ class (A for ovens), intended to furnish a property undergoing renovation, and other appliances such as washing machines, washer-dryers, dishwashers. refrigerators and freezers.

It consists of a 50 percent personal income tax deduction of a maximum €10,000 expenditure or can be applied for via credit transfer or a discount on the invoice. This applies to the purchase of furniture and household appliances to furnish a property undergoing renovation.

The subsidy is linked to the renovation bonus. To be sure you can access it, the renovation work must have begun before buying any furniture or appliances – but expenses on restoring the property don’t need to actually be paid beforehand.

Renovation bonus

The Bonus Ristrutturazioni has been confirmed until December 31st 2024, allowing homeowners to apply for a 50 percent tax reduction on carrying out renovation work in both individual properties and condominiums.

The rules remain unchanged – there continues to be a maximum limit on expenses of €96,000 and the 50 percent offset to taxes is divided into annual instalments for 10 years. Or you can apply for the invoice discount or credit transfer.

There is a raft of allowances for accessing this bonus. These include making repairs on property that has been damaged, building garages or parking spaces, increasing security of the property such as installing gates, security doors and CCTV, removing asbestos and gas detection equipment.

Not only are homeowners eligible to apply for this bonus, also tenants of properties, separated spouses of the property owner and co-habiting partners are too.

READ ALSO: Italy’s building bonus: Can you really claim back the cost of renovating property?

Photo: Andrew CABALLERO-REYNOLDS / AFP

Ecobonus

The 50 percent and 65 percent ecobonus, a tax deduction aimed at encouraging energy upgrading in buildings, will remain in force and will exist in parallel with the ‘superbonus’.

Its extension in the 2022 Budget Law will allow taxpayers to benefit from tax discounts for works aimed at improving the energy performance of existing buildings.

READ ALSO:

The ordinary ‘ecobonus’, which has less stringent eligibility criteria than the 110 percent ‘superbonus’, is an IRPEF (income tax) and IRES tax (corporate income tax) deduction recognised for numerous expenses, including those relating to the replacement of boilers or windows and frames, for instance.

The following tax deduction rates have been confirmed in the Budget Law:

  • 50 percent for window frames, biomass and solar screens;
  • 65 percent for the remaining types of expenditure.
  • If works are carried out on common condominium areas, the amount of tax deduction varies from 70 percent to 75 percent.

Sismabonus

The sismabonus is intended for renovation work in areas hit by seismic events and for making homes safe by upgrading the seismic class on parts of buildings or single property units. It has been extended to the end of 2024.

The 2022 Budget Law has confirmed that it will be possible to opt for various tax deductions if you choose to reduce the seismic risk of your home.

Depending on the type of work carried out on the property, there are different amounts of the bonus available. From a 50 percent deduction up to 85 percent bonus in some cases. This can either be claimed via tax deductions or the more rapid credit trasnfer or discount on invoice.

This bonus has been available for a number of years, and provides a maximum expenditure of €96,000 for each building unit.

First home bonus for under 36

Tax incentives for the first home bonus for young people, in this instance categorised as under 36, have been extended for the whole of 2022.

UPDATE: Under 36? Here’s how Italy plans to help you buy a house

Rent discounts for young people

Young people, classed as between 20 and 31 for this measure, could benefit from a 20 percent discount on rent up to €2,000. The deduction can also be used by under 31s, out-of-town students, who simply rent a room.

It is intended for those who leave home and have their own income up to a maximum of €15,493.71.

According to the Budget Law text, the discount applies whether you rent an entire flat or a room.

It must “be used as their own residence, provided that the same is different from the main residence of their parents or of those to whom they are entrusted by the competent bodies.”

The measure is due to last for four years. Certain properties such as luxury buildings are excluded from the bonus.

Green bonus

The Bonus Verde has also been extended into 2022 – you could get state help for landscaping your garden or private outdoor areas of existing property, supplying plants and shrubs, doing work on fences, irrigation systems, building wells, roofs or roof gardens.

There’s a 36 percent tax deduction available for jobs relating to gardens, terraces and green areas in general.

If using the tax deduction method, the tax relief applied in the tax return must be divided into 10 annual instalments of equal amounts and must not exceed a maximum expenditure equal to €5,000 for each property.

Therefore, amounts of up to €1,800 (36 percent of €5,000) can be claimed back. This bonus can also be claimed via credit transfer or a discount on the invoice.

Unlike the furniture bonus, this deduction is not linked to the incurring of expenses related to the building renovation.

How claiming building bonuses will change

Perhaps the most eagerly anticipated feature of the new Budget Law was how people could claim.

Many building tax bonuses are available via credit transfer (cessione del credito) or a discount on the invoice (sconto in fattura), the Budget Law confirmed.

READ ALSO: Do you have to be Italian to claim Italy’s building bonuses?

Both these options were set to expire on December 31st 2021 for most, leaving tax deduction the only option – making it difficult for more people to access the bonuses quickly.

Despite earlier suggestions, government aid for renovating property such as the sismabonus, ecobonus, bonus facciate, bonus mobili and bonus verde will be able to count on these important financial measures, crucial for the start of works.

The superbonus 110 will also continue to benefit from credit transfer and a discount on the invoice.

See more in The Local’s Italian property section.

Member comments

  1. Regarding the deadline of June 30, 2022 for the Superbonus 110%, does the work need to have started by December 31, 2021 or does it only need to be finished by June 30, 2022 regardless of start date? GRAZIE!!

  2. We have recently purhcased a property that needs renovating, extending, landscaping etc. etc. We have been told that as non-residents we can pay for the work to be completed and then we can claim a percentage of the costs back through our bank – does anybody else have any experience of this and could comment with advice please? Much appreciated. *no work has started yet we have only recently taken ownership of the property and land.

Log in here to leave a comment.
Become a Member to leave a comment.
For members

PROPERTY

Five pitfalls to watch out for when buying an old house in Italy

Tempted to snap up a little slice of Italy at a bargain price? The older the house, the more potential issues you'll need to be aware of.

Published: 29 March 2024 10:17 CET
Updated: 29 March 2024 12:03 CET
Five pitfalls to watch out for when buying an old house in Italy

Italians themselves may have very little interest in buying or fixing up Italy’s many unwanted old houses, but international visitors are often swept away by the charm of these rustic buildings in romantic settings.

It’s easy to see why. The quirky structures, period details, and picturesque surroundings – not to mention low asking prices – inspire countless people worldwide every year to investigate buying an Italian home of their own, often as an investment or retirement property.

MAP: Where in Italy can you buy homes for one euro?

International interest in cheap Italian property has only intensified in recent years, with dozens of idyllic villages advertising ‘one euro’ homes and other low-cost property offers aimed specifically at foreigners.

Savvy buyers are aware that non è tutto oro quel che luccica (all that glitters is not gold), and quickly realise that these long-neglected buildings really cost somewhat more than one euro to buy and renovate. Still, some of The Local’s readers tell us these offers are worth taking advantage of.

But whether you’re looking at spending a couple of thousand euros or much more on your dream Italian property, there’s always a lot to consider – including some issues that you’re unlikely to experience when buying a home in your home country.

These unexpected issues can turn the Italian dream into a bit of a nightmare, and sometimes lead to buyers having to abandon a purchase, losing money in the process.

But if you’re aware of potential pitfalls in advance, you’re far more likely to be able to complete the purchase process with no major problems at all.

Property taxes and fees

Of course you’ll be expecting tax as part of the property purchase process, but Italian property taxes are particularly steep.

Experts say the total cost of buying in Italy will add approximately ten percent to the purchase price, and advise prospective buyers to budget accordingly.

There’s stamp duty, which is between two and nine percent of the cadastral value (valore catastale) of the property, with a minimum threshold of €1,000 even on the cheapest homes. Plus VAT at four or ten percent, land registry tax, and, if applicable, mortgage tax.

You can also expect to pay between one and five percent of the purchase price as a fee to the estate agent. In Italy agents work for both the buyer and seller – and collect compensation from both parties once the deal is done.

Then you’ll likely need a couple of thousand euros for the notary, plus a similar fee for any other agents you use, such as a mortgage broker, plus legal fees if a lawyer is involved.

See more about the ‘hidden’ costs of buying property as a foreigner in Italy.

Bickering relatives

It may sound unbelievable to non-Italians, but it’s not unusual to find that even the smallest old properties, or parts of them, are legally divided up between dozens of family members due to Italy’s inheritance rules.

One buyer The Local spoke to found herself having to deal with 22 people, all relatives, who each turned out to own a share of a small property she was buying in Mussomeli, Sicily; one of the first places in the country to sell off old properties for a euro.

Toti Nigrelli, the mayor of Mussomeli, said “having to negotiate the sale with multiple owners” was normal.

While this buyer impressively managed to negotiate the deal with all 22 parties, in many cases similar sales fall through because relatives – distant cousins, great-aunts, long-lost nephews – are often not on good terms, disagree over the sale, or can’t be traced.

At the very least, you will need to check the property’s records carefully to make sure there are no surprises in store – such as long-lost relatives who might turn up to claim the property back after you’ve bought it.

A trullo house before renovation in Cisternino, Puglia. AFP PHOTO / GIUSEPPE CACACE

Illegal builds

Another thing that often astounds foreigners who buy property in Italy is the enormous number of illegal builds – homes that were built entirely without permits – on the market as well as the even greater number of houses featuring modifications which were never officially approved or recorded.

Illegal housebuilding in Italy is often thought of as a decades-old issue, but recent data shows that, in 2021, 15 houses were built illegally for ever 100 authorised. Illegal building is twice as common in the south of the country as in the north, and thousands of cases are detected every year – though few people are ever prosecuted.

If you buy a house with undeclared modifications, the buyer is usually held responsible for paying to regularise the paperwork with the town hall. If you catch this issue early enough – and not all sellers or estate agents will inform you about them – you may be able to negotiate for the seller to cover these costs before you make an agreement.

If however you end up unknowingly buying a house built without the correct permissions, or if you never regularise any unauthorised changes, the property will likely prove very difficult to sell on.

This is one of many reasons why buyers need to carefully check the catasto (land registry or cadastral records) of a property themselves, and have a notary check everything is in order.

Conservation rules

When you initially view and fall in love with that charming stone house in the historic centre of a gorgeous Italian hilltop town, rules and regulations are probably not the first thing on your mind.

But it pays to know that old homes featuring frescoes, loggias or ancient stone cellars, as appealing as they are, are often protected by Italy’s cultural heritage authority – meaning more red tape for their owners.

One reader was forced to give up her dream of buying a portion of a two-floor 1700s building in the village of Civita Castellana, Lazio, because it needed renovation work to make it livable – but the frescoed walls, decorated fireplaces and elegant stonework entrance were vincolati (under restrictions) due to Italy’s historic conservation rules.

READ ALSO: Tuscany or Basilicata? How Italy’s international property market is changing

In many cases, this means renovation work can’t be carried out at all, or will be subject to reams of paperwork and close monitoring from authorities known as the sovraintendenza belle arti. To make things trickier, rules can also vary by local authority.

If you think a property you’re interested in might be subject to these rules, it’s always wise to consult the local sovraintendenza at an early stage. And of course, you’ll want to get hold of the records of the property from the catasto (land registry).

Resale prices

The high taxes and costs involved in buying and selling a property in Italy are often said to be one reason why, for most Italians, the concept of climbing the property ladder doesn’t really exist in the way it does in some countries.

Italy’s property market is unusual in Europe in that house prices on average are relatively stagnant. With the exception of some types of property – such as new-build apartments and luxury homes – overall prices have risen little over the past decade.

This is partly because the Italian market is weighed down by a large volume of old, neglected properties in need of major work – hence schemes like the one-euro sales and the (formerly popular but now-unavailable) 110 percent ‘superbonus’ for renovations.

But overall, if your main motivation for buying an old Italian home and renovating it is profit, you’ll need to consider that the resale potential may not be what you’d hope. The exceptions to this are at the pricier end of the market, in most major city centres, and in tourist hotspots.

See more in The Local’s Italian property section.

Do you have any more tips on buying a property in Italy? We’d love to hear from you in the comments section below.

SHOW COMMENTS