COPY LINK

For members

LIVING IN ITALY

EXPLAINED: What is an Italian notary and what do they do?

What do Italy's notaries do, exactly? Why are their services so expensive? And is this really a profession that's only open to an elite few? Reporter Jessica Lionnel finds out more about the 'world's oldest' notariat.

Published: 3 October 2023 16:54 CEST
Updated: 25 January 2024 15:13 CET

EXPLAINED: What is an Italian notary and what do they do?

A statue representing Justice outside a court in Milan. (Photo by Giuseppe CACACE / AFP)

Italy’s international residents are often unsure about what the work of a notary (notaio) actually involves. And you may also have heard people say that Italian notaries are members of an elite profession – perhaps even one that’s open only to members of the nobility.

It’s no secret that notaries are an important part of Italian bureaucracy. Whether you’re buying a new house or want to legalise something within a business, chances are you will need a notary to sign and validate your documents – a service which can cost anything from around €500 to €5,000.

This is a lot steeper in price compared to the UK or US, where generally the figure for getting documents notarised is around $100 or lower.

But Italian notaries themselves say there are two reasons for the dramatically higher sum: the model used and the length of training.

“It is a very old profession. In the 1200s many teachers were notaries at the University of Bologna,” says notary Carmelo di Marco. “But the role didn’t really evolve until the Renaissance period when more documents and paperwork were being produced.”

Di Marco has been a notary for almost 30 years and has his office Di Marco Carmelo Studio Notarile in Milan.

He says the Italian notariat is widely considered the oldest in the world and, because of this, 86 countries at present follow the Italian-born, Latin notary model. The model means notaries must be appointed by the state, trained in law and, above all, must be impartial.

A man shows his ID before signing a document in front of a notary. (Photo by GIUSEPPE CACACE / AFP)

“The same cannot be said for the UK or the US which operate under common law and therefore do not have a Latin notary model,” he says.

“There, the notary is only responsible for the authentication of signatures. Here the notary’s work is more in-depth and we operate in different matters such as real estate, family, companies and commerce.

“The notary’s role is to act as a third person. For instance buying a home and applying for a mortgage, donating your home to your child, setting up a company, or making a will.

“What are the risks in carrying out these operations? Can one be aware of all the obstacles and pitfalls caused by constantly evolving laws that are not always easy to understand?”

The road to becoming a trained notary is just as in-depth, and it’s perhaps for this reason that the profession is seen as being elite, as it is costly and time-consuming.

Similarly to the UK and elsewhere, you need to be trained in law to enter the field. Upon graduation, notary trainees need to undertake an 18-month-long apprenticeship.

It doesn’t end there. In the third and final stage, the trainees enter a concorso (‘competition’) run by the Ministry of Justice, in which they complete three written and oral tests in Rome.

READ ALSO:

If they pass, the Ministry of Justice assigns an office to the newly qualified notaries. If they don’t, they can retake the exam when it opens again. This final step can be done five times maximum.

“The timeline for the competition is subjective,” Di Marco adds. “Firstly, the Ministry of Justice says when there is enough space for the competition to be open again so the dates aren’t concrete.

“Secondly, you have to be accepted to enrol in the competition, which is a competition in itself. Then you have to wait for the results of the competition which can take more or less one year.”

The process should take five years, but Di Marco says this could take longer for some people.

Today, technology and increased global movement are changing the field.

While Di Marco says technology helps speed up the process of finding information and signing document, and this makes the job easier, global movement has made it more complex.

“The world seems to be a bit more accessible now than it was back in 1200,” he says.

“We have to be aware of people from other countries, too. Take these examples: you get married to a foreign national or you want to buy a second home in Italy but don’t live here. We notaries have to be aware of laws surrounding this before validating documents.

“Global movement has added more strands to our work. I predict this area will grow more in the future.”

Member comments

Anonymous - 3 October 2023 at 17:38 CEST

Hmm, they are too expensive as our estate agents, they really are expensive.

Become a Member to leave a comment.

With income declarations now open in Italy, there are several details of the Italian tax system that you need to know, especially if this is the first time you file.

From deadlines to rules on foreign income and assets to second homes, here is our guide to the 2024 tax season.

2024 tax deadlines

Late spring is generally the busiest time of year for Italian taxpayers as that’s when the window to file the yearly income tax declaration (or dichiarazione dei redditi) opens.

Barring some rare filing exemptions, anyone who’s considered an Italian resident for tax purposes (or fiscal resident) is required to file income taxes in Italy.

But even if you’re not an Italian tax resident, you may still have to file and pay Italian taxes on any income generated in Italy.

Depending on your personal tax situation and income source, you’ll have to file one of two forms, whose official deadlines for this year you can find HERE. The window to file either form is open as of May 20th.

It is strongly advisable to keep the main income tax dates in mind as the Italian taxman shows little in the way of leniency when it comes to late filing and failure to file.

Besides income tax deadlines, there are two other dates you need to be mindful of if you own property in Italy. The first instalment of Italy’s tax on second homes IMU (Imposta Municipale Unica) is due by June 16th, whereas the second instalment is due by December 16th. You can find these and other key tax dates for 2024 in our calendar.

First-timers

If this is your first time declaring tax in Italy, your first task will be to request a codice fiscale (a personal identification number similar to an American Social Security number or a British National Insurance number) if you don’t already have one. Find a guide to doing that HERE.

The 2024 income tax declaration covers the 2023 tax year, which runs from January 1st 2023 to December 31st 2023. As a result, if you moved to Italy after January 1st 2024, you will not have to complete the declaration until next year.

On the other hand, IMU payments are always relative to the year when you make the payments – in this case 2024.

Online v paper

Most people in Italy file their tax declarations and make payments using the personal profile area (area riservata) of the Italian tax office (Agenzia delle Entrate) website.

This is also where taxpayers can find a pre-compiled version of tax return form 730 (or modulo 730) – which is the income tax declaration form generally used by employees and retirees in Italy.

Though most tax declarations can be filed online, there are provisions for people who don’t have internet access or are not comfortable completing tasks online. In this case, you can visit or call your local tax office and request paper versions of the forms, which you can then submit at the same office or, in some cases, at local post offices.

Income tax brackets

Italy’s income tax Irpef applies to employees, many self-employed workers (regular partita Iva holders, but not those on the flat tax rate) and pensioners.

The Italian government cut the number of available tax brackets from four to three last December, but the change only applies to income generated from January 1st 2024.

This means that your 2023 income will be taxed based on the four-bracket system below:

Up to 15,000 euros: 23 percent
Between 15,001 and 28,000 euros: 25 percent
Between 28,001 euros and 50,000 euros: 35 percent
Over 50,000 euros: 43 percent

Like income taxes in many other countries, Italy’s Irpef is a progressive tax, meaning that you only pay the higher rate on the portion of your income that is over the relevant threshold (for instance, 43 percent on the portion of income exceeding 50,000 euros).

Foreign income

It’s not unusual for foreigners in Italy to have some or all of their income coming from outside Italy – whether that is a pension paid from an overseas country, remote working for a non-Italian company or rental income from a property outside of Italy.

If you’re an Italian tax resident, you’ll be required to declare your global income – that is income generated not just in Italy but anywhere in the world.

It’s important to note though that declaring your foreign income does not necessarily mean you will have to pay tax on it.

Italy has dual taxation agreements with most countries, including the UK and US, meaning that if you have already paid tax on your income in another country, you won’t be taxed on it again – though you’ll still have to tell the Italian taxman about it.

Foreign assets and bank accounts

Italian tax residents who hold financial assets abroad – this includes real estate, financial investments, unit trusts, and even foreign bank accounts – are required to declare them by completing the foreign assets section of their yearly tax return form (section W of form 730 and section RW of form Redditi PF).

Depending on the types of assets you own abroad, you may have to pay Italy’s tax on foreign real estate (IVIE) and/or a tax on foreign financial activities (IVAFE).

It’s worth noting that retirees who’ve opted for Italy’s special seven-percent flat tax rate are exempt from the requirement to declare (and pay IVIE and/or IVAFE on) foreign assets.

You can find further info about declaring foreign bank accounts HERE.

Tax breaks

Italy has a number of tax breaks to help taxpayers, especially those with lower incomes, reduce their tax bill each year.

These are generally divided between tax deductions (deduzioni fiscali), which lower your taxable income, and tax reductions (detrazioni fiscali), which lower your final tax bill.

Tax reductions for 2024 apply to anything from rent to public transport to education expenses, and include a 19-percent tax break on medical expenses applicable to amounts exceeding 129.11 euros. You can find a full list (in Italian) of tax reductions and deductions here.

It’s also worth noting that Italy offers a number of favourable multi-year tax regimes for residents – these include the so-called ‘impatriate’ tax scheme and the seven-percent flat rate for foreign pensioners – as well as a number of home renovation bonuses.

Tax for second-home owners

If you live outside of Italy but you own property in the country which you use as a second-home or holiday home, there are a few things to be aware of, with the first being whether or not you are an Italian tax resident.

If you use your Italian property just for holidays then you probably won’t be. But if you tend to spend a significant amount of time in your Italian property, you should keep in mind that Italy’s tax office will consider you a tax resident if, for at least 183 days a year, you are registered with Italy’s National Registry of the Resident Population (or Anagrafe) or have your place of “residence or habitual residence” in Italy.

The other thing to consider is whether you have any Italian income through renting out your property, including on Airbnb. If you do, you will need to declare this income in Italy.

Finally, even if you’re not an Italian tax resident and don’t generate any income in Italy, you’ll still have to pay Italy’s property tax IMU (Imposta Municipale Unica), which is owed by all owners of second homes. You can find this year’s IMU deadlines HERE.

Getting help

If you’re completely daunted by the Italian tax system, don’t panic: help is available.

If you have a fairly simple tax situation (e.g. you have a single employer and no other sources of income) and speak some Italian, you may be able to get the assistance you need at one of Italy’s tax support centres (Centri di Assistenza Fiscale, or CAF).

If, however, you are self-employed, are starting or operating a business, are earning income in multiple countries, or simply find the whole process too difficult, you may need the help of a chartered tax accountant, or commercialista in Italian.

Please note that The Local is unable to advise on individual cases. Find more information on the Italian tax office’s website or seek independent advice from a qualified tax professional.

SHOW COMMENTS

Url copied to clipboard!