IVA (Imposta sul Valore Aggiunto – Value Added Tax)

A consumption tax applicable to certain property transactions and services. In Italian real estate, VAT is charged on sales by construction companies (or property dealers) of new or substantially renovated buildings sold within 5 years of completion (or later if the seller opts to apply VAT) . The VAT rates are: 4% for qualifying first-home purchases (non-luxury, buyer meets prima casa criteria), 10% for other residential purchases (most new apartments, etc.), and 22% for properties classified as luxury (A/1, A/8, A/9) or for commercial real estate sales. If VAT is applied, the registration, cadastral, and mortgage taxes are just fixed €200 each, instead of the percentage-based registration tax. VAT also applies to real estate services (e.g. real estate agent fees are +22% VAT if the agent is a company or VAT-registered). Rentals of residential properties are generally VAT-exempt (landlords who are private individuals do not charge VAT on rent). It’s important for buyers to know if a transaction is subject to VAT or registration tax – you cannot be charged both on the sale.