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PROPERTY

What’s happening with Italy’s building superbonus in 2024?

With a potential amendment to Italy’s ‘superbonus’ in the news, what could this mean for homeowners - and is the government planning to solve other problems with the scheme?

Superbonus
Italy's controversial superbonus is once again in the news as a new amendment is being considered by cabinet. Photo by Adrian DENNIS / AFP

If you’re reading this article, chances are you’re already familiar with the history of Italy’s ‘superbonus 110′, a government scheme offering generous discounts to homeowners carrying out renovation works.

Since the bonus’s introduction in 2020, countless people mid-renovation have been left high and dry as major credit transfer backlogs stalled their projects indefinitely and left thousands of construction businesses at risk of bankruptcy.

Further controversy emerged in late 2022 as a series of hastily approved amendments aimed at alleviating the scheme’s burden on public finances meant that the maximum rebate many of these claimants could access was slashed by as much as 20 percent.

But as the year draws to a close, an amendment being put forward proposes that homeowners who started their projects before last year’s changes could continue to benefit from the original 110-percent discount after all.

What’s the amendment about?

The amendment, proposed by the Forza Italia party – a member of the coalition government – would effectively allow claimants who have benefitted from the original 110-percent rebate in 2023 to continue doing so for the first half of 2024, until June 30th.

Superbonus, Italy

After undergoing sweeping changes earlier this year, the superbonus may soon be subject to yet another amendment. Photo by Philippe HUGUEN / AFP

However, according to the latest reports, the extension would only apply to projects that are at least 60 percent complete by the end of 2023 (and have been assessed as such under their Stato Avanzamento Lavori, or SAL).

Who would this affect?

The maximum available rebate was slashed from up to 110 percent of the total cost of work to a maximum of 90 percent as of January 1st 2023. 

But the following two categories of claimants were allowed to continue benefitting from the original maximum rebate until December 31st 2023:

  • Owners of independent or single-family homes (case unifamiliari) that had completed at least 30 percent of the planned renovation work by September 30th 2022, and
  • Condominiums or apartment buildings that had handed in their Commencement of Work Certificate (Comunicazione di Inizio Lavori, CILA) by December 31st 2022.

If the amendment passes, people in these two categories would be able to continue to claim the maximum 110-percent rebate until June 30th 2024 provided they reach the 60-percent completion status by the end of this year. 

There are currently no clear indications as to how the cabinet will rule on the proposal, which, if passed, would fall under Italy’s 2024 Budget Law.

READ ALSO: How will Italy’s 2024 budget affect your finances?

While Economy Minister Giancarlo Giorgetti said last week that an “extension of the measures […] in their current form” wasn’t in the government’s plans, the amendment is reportedly still on the table.

What else can we expect in 2024?

Under the December 2022 amendments, the superbonus will only apply to the renovation of condominiums and small apartment buildings, with the scheme’s maximum available rebate dropping from 90 percent of the total cost of work to 70 percent from January 1st 2024. 

Further, claimants will still only have one way to claim the bonus in 2024; that is in the form of tax deductions (detrazione fiscale) spread over four years, as the sale of credit to banks or construction companies was permanently scrapped last February. 

Are there any plans to unlock ‘stuck’ credit?

The superbonus has been plagued by credit transfer issues ever since 2021, when banks stopped buying up credits following billions’ worth of fraudulent claims. This created major bottlenecks within the system which ultimately ended up stalling thousands of projects. 

Nearly three years on from the start of the crisis, the credit logjam seems to be nowhere near an immediate resolution and, despite a series of government interventions over the past year, owners and construction companies still have just a handful of viable options to sell previously accrued credit. 

Worker, construction, heat

Major credit bottlenecks persist within the superbonus system nearly three years after the start of the crisis. Photo by Valentine CHAPUIS / AFP

After a number of national banks resumed buying credits over the summer, postal service provider Poste Italiane reopened their purchasing channels in early October. 

That said, the institute is currently only accepting credits under 50,000 euros and coming exclusively from homeowners (building companies and other third parties have been excluded from the service). 

Finally, the creation of a new trading platform by energy giant Enel X – a project that the government had previously identified as one of the main solutions to the logjam – was permanently scrapped in early September. 

Though there are no new official figures regarding blocked credits, Italy’s Builders Association (ANCE) estimates that these now amount to 30 billion euros, with some 30,000 businesses and around 300,000 households being directly affected by the impasse.

Economy Minister Giancarlo Giorgetti recently said that his ministry was evaluating “instruments” that “should contribute to remove obstacles to [credit] transfer”, without giving any further details.

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TAXES

IMU: Who has to pay Italy’s property tax?

The first instalment of Italy’s main property tax IMU is due by Monday, June 17th, this year – but not all homeowners in the country have to pay it.

IMU: Who has to pay Italy’s property tax?

Italy’s main property tax, IMU (Imposta Municipale Unica, or Unified Municipal Tax) was introduced in 2012 to replace the local ICI levy.

It applies to both private and commercial property, building areas and agricultural land, and its exact amount varies by the type, value and location of the property.

IMU must be paid in two yearly instalments, with the first payment normally due by June 16th (the deadline was moved to June 17th this year as June 16th is a Sunday) and the second one due by December 16th. 

But the tax is a frequent source of confusion for homeowners in Italy as the rules on exactly which types of property it applies to have changed multiple times over the years.

Taxpayers are fully responsible for calculating and paying the amount of IMU they owe, meaning you won’t get a bill from local authorities specifying how much you need to pay for the relevant year.

Who does IMU apply to?

IMU is generally owed by owners of the following types of property:

  • Agricultural land (or terreno agricolo in Italian)
  • Building land (area fabbricabile)
  • Private houses other than the owner’s main residence (or prima casa), meaning second, third, fourth homes etc.
  • Luxury dwellings (case di lusso) falling under Italy’s cadastral categories A1 (stately homes), A8 (villas) or A9 (castles), regardless of whether they are the owner’s main residence or not.

Essentially, besides agricultural and building land owners, IMU is owed by all second-home owners in the country and owners of properties categorised as ‘luxury’ under Italy’s cadastral system.

READ ALSO: The Italian tax calendar for 2024: Which taxes are due when?

The tax doesn’t apply to main residences (prime case) but owners must be Italian residents and be registered as such under Italy’s national registry (Anagrafe) in order to qualify for this.

If you’re a foreign resident owning property in the country, you’ll have to pay IMU on it.

There are a number of IMU exemptions and discounts available to some categories of homeowners. 

These include for instance a 50-percent discount for retirees residing abroad and claiming a ‘totalised pension’ (pensione totalizzata), meaning a hybrid ‘Italian-foreign’ pension merging contributions made in Italy and those made in the foreign nation they reside in (as long as this country has pension totalisation agreements in place with Italy).

How do I calculate IMU?

Much like most other Italian taxes, calculating IMU is by no means an easy process, especially if you have little to no experience with paying it. 

That’s why it’s generally advisable to consult a chartered accountant (commercialista) who can ensure that the correct amount is paid and even arrange the transaction for you.

READ ALSO: What is an Italian commercialista and do you really need one?

That said, as a rough guide, you’ll need to take the cadastral value, or valore catastale, of your property (this is generally reported in the public deed of purchase but you can also request it at your local land registry).

Once you know the cadastral value, you must increase it by 5 percent and then multiply that number by a coefficient, which varies by the type of property you own. For instance, private residential buildings and flats have a coefficient of 160. 

Doing this will give you your property’s taxable base and from there you’ll be charged anything from 0.5 to 1.06 percent of that figure, depending on the rate (aliquota) applied by the municipality (comune) where your property is located.

How do I pay?

IMU can be paid via Italy’s standard tax form F24, which is used when paying most types of taxes in Italy, including Irpef income tax instalments.

The form can generally be found and submitted at most bank branches and post offices in the country. Some Italian banks even offer customers the option to complete and submit an F24 form directly online.

Alternatively, you can ask an Italian accountant to complete and submit the form on your behalf.

What happens if I don’t pay?

The Italian taxman shows little in the way of leniency when it comes to late filing or failure to pay IMU. 

Late filing can be punished with a fine of up to 30 percent of the IMU owed, whereas failure to pay can lead to enforced credit recovery procedures (recupero coattivo del credito) from local authorities. 

The good news here is that Italy has a procedure known as ravvedimento operoso (literally ‘active amendment’) which allows taxpayers to self-report and quickly rectify the delay in their IMU payments in exchange for significantly reduced fines.

For example, under this system, fines for late payment are reduced to 0.1 percent of the sum owed per day if the payment is made within the first 14 days from the relevant deadline.

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.

For more information on property in Italy, check The Local’s property section.

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