
From property tax changes to short-term rentals, the economic growth decree is a law that has been given the green light by the Italian House of Representatives and contains important measures for the real estate sector in Italy. It’s designed to help ease tax measures and the financial situation in Italy to boost the economy. Let's take a quick look at the main developments of the tax decree 2019, known in Italian as the 'decreto crescita'.
Confirmation of the cedolare secca option
The Italian government will no longer issue fines for those who forget to confirm their use of the cedolare secca flat-rate tax scheme when declaring tax on rental contracts which are extended.
Identification code for short-term lets
Each property used for short-term rentals must have its own unique identification code which is used for "any communication relating to the offer and promotion of services to users". This same code must also be used by internet portal operators and real estate agents when advertising the holiday let. There will be penalties of between 500 and 5,000 euros for those who do not comply with this law.
Communication of tenants' data to the Inland Revenue
The personal data of tenants who stay in short-term rental apartments in Italy is currently communicated by landlords to the State Police. This will be extended to also be communicated (anonymously and structurally aggregated) to the Agenzia delle Entrate Italian Tax Agency to verify the payment of taxes on holiday rentals.
Tax on uncollected rents
For contracts entered into on or after 1st January 2020, the growth decree allows landlord not to pay taxes on rent they haven’t yet been paid if the failure to collect them is proven by a legal "eviction injunction due to defaulting or a payment order".
IMU declaration deadline
The deadline for declaring the municipal property tax (Imposta Municipale or IMU), which up to now has been set for 30th June, will be postponed to 31st December of the year following that to which the tax data being reported pertains.
IMU declaration agreed fee and loan of use
The obligation to declare IMU taxes for houses freely granted on loan for use is to be scrapped, but it will still be mandatory to register the operation with the Tax Office. The obligation to declare agreed rental prices for leased property has also been removed and "any other obligation to declare and report" imposed by the individual Italian municipalities is also gone. On the other hand, rental contracts drawn up without the assistance of trade associations still need to be "stamped".
IMU for rural buildings
The IMU on capital real estate will become deductible from business income as of 2023. Until then, the percentage of the tax deduction available will increase bit by bit: 50% for the IMU 2019, 60% for 2020 and 2021 and 70% in 2022.
Get discounts using the ‘Ecobonus’
Taxpayers who carry out energy efficiency improvement works on their building or reduce the seismic risk of their property can choose to receive an advance contribution from the builder in the form of a discount on the cost of the work, instead of a tax deduction afterwards. The builder, in turn, may recover the money from granting this discount in the form of a tax credit or may assign the credit to their suppliers of goods and services.