BREXIT: Buying a property in Italy after 31 December 2020
February, 2021
BUYING OR RENTING OUT A PROPERTY IN ITALY
At the end of the Brexit transition period (31 December 2020), UK investors in Italy are in a similar position to those from the US i.e. no restriction onproperty purchases or rentals in Italy.
As stated in the EU-UK Trade and Cooperation Agreement concluded on 24 December 2020 restrictions on acquiring immovable property apply in certain geographical areas for non-EEA nationals. However, Italy is not among these areas.
UK nationals’ right to own or to buy a property in Italy will therefore not be affected. British residents will still be able to buy a house in Italy, to use the property as a holiday/second home or to rent it out as an income stream.
Property ownership has always been based on sovereign laws set by individual countries. It is worth noting that property investments are not governed by EU legislation.
THE UK-ITALY CONVENTION FOR THE AVOIDANCE OF ON DOUBLE TAXATION.
The bilateral Convention between UNITED KINGDOM and Italy for the avoidance of double taxation will remain in force.
Under the termsof the Convention, if a person has a permanent home in both Contracting States, they aredeemed to be aresident of the Contracting State closest to his/her personal and economic relations (i.e., theircentre of vital interests).
So, a UK citizen is not considered a fiscal resident of Italy solely on account of their property ownership in Italy.[F1]
WILL 22% VAT BE APPLIED TO LEGAL SERVICES?
Legal consultations and services related to real estate purchase and/or planning (e.g., services provided by Italian lawyers and Italian public notaries) to non - EU residents are considered to be lacking “territoriality”, and thus will no longer be subject to 22% VAT.
However, forproperty purchase taxes and property annual taxes, there is no difference between EU or Non-EU citizens.
IS THERE A RIGHT TO RESIDENCE?
UK nationals are allowed free access to Italy without a visa for up to 180 days a year but no more than 90 days in 1 continuous period.
People who want to stay more than half a year can apply for an Elective Residence Visa and Residence Permit.
In recent years, a number of attractive tax schemes aimed at people relocating to Italy have been introduced, which provide tax breaks for foreign income.
WILL HEALTHCARE ARRANGEMENTS BE GUARANTEED?
Reciprocal healthcare arrangements will continue.
Leaving Europe, live and invest in Italy.
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