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PROPERTY

Homeowners claim €9 billion from Italy’s building ‘superbonus’

Italy has approved investments of over nine billion euros so far for works related to making energy efficiency upgrades and reducing seismic risk, new figures show.

Published: 3 November 2021 17:14 CET
Billions have been claimed under Italy's building 'superbonus'.
Billions have been claimed under Italy's building 'superbonus'. Photo by Gianluca Carenza on Unsplash

Italy launched the ‘superbonus 110‘ in May 2020 to restart a sluggish economy following the impacts of the pandemic, offering homeowners a tax deduction of up to 110 percent on renovation expenses.

Interest in the scheme has been high, with many property owners now facing delays and sometimes abandoning projects due to builder shortages and the complex bureaucracy required to access the scheme.

READ ALSO: Italy’s building bonus: Can you really claim back the cost of renovating property?

Critics have asked whether the superbonus has achieved its objectives of upgrading Italian property standards and boosting the construction sector.

But new figures from Italy’s energy and development agency, ENEA, updated to the end of October 2021, show that investments in the superbonus are considerable.

Such government-funded building projects related to energy efficiency and anti-seismic interventions have amounted to more than 9.7 billion euros to date.

The findings reveal that on a national level, some 57,664 claims have been filed to access the superbonus and that over 6.7 billion euros have already been claimed for completed renovation works.

The 3 billion euros of difference are assigned for ongoing renovation works which have not yet been completed.

The regions filing for the superbonus the most include Lombardy in first place, claiming 1.5 billion euros of investment, followed by Veneto, Lazio and Campania.

Figures show that the demand for the superbonus continues to rise, as ENEA recorded an increase of 24.8 percent in claims filed between September and October.

Photo: Mattia Bericchia on Unsplash

Overall, some 69 percent of projects have been finished out of the total works started under this building incentive.

Data are also broken down for works on condominiums, single-family buildings, and independent building units.

READ ALSO:

Condominiums accounted for almost 50 percent of the economic value of the scheme, with a total investment of almost 4.8 billion euros in this type of building.

Single-family homes accounted for the highest number of requests, with 29,369 claims filed so far worth a total of almost 3.1 billion euros.

Former Italian Prime Minister Giuseppe Conte, who initially introduced the scheme, claimed that ENEA’s figures show “growth, work and environmental sustainability”, adding that the superbonus must be extended as “it is not time to slow down the restart of the country”.

Time is running out for owners of single family homes to access the superbonus, however.

The Italian government announced its raft of budget measures for 2022 at the end of October, including extensions to tax breaks for home renovations.

EXPLAINED: What changes in Italy’s new budget?

The superbonus scheme has been extended for condominiums until 2023, but for many homeowners hoping to claim it for their single family homes, deadlines are approaching.

The bonus is set to continue for the whole of 2022 for single family units, but with a serious caveat: you’re only eligible if it’s your first home and you have an ISEE (the social-economic indicator of household wealth) of 25,000 euros maximum.

From January 1st to June 30th 2022 it will not be necessary to comply with the ISEE limit.

If you don’t fall into this category, however, the deadline of June 30th 2022 remains.

That means there are potentially just 8 months to complete all building works as so far there has been no mention of being able to finish a project on a single family home already started after this date.

For condominiums benefitting from the 110 percent deductions until 2023, the bonus will then drop in stages – to 70 percent for 2024 and 65 percent for 2025.

Other building bonuses have also been rolled on but some have been slashed in terms of the amount available to claim, meaning budgets could change considerably for those planning to carry out works in 2022.

Are you using Italy’s superbonus to renovate your property? Please get in touch or leave a comment below to tell us about your experience.

See more in The Local’s Italian property section.

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TAXES

How does Italy decide if I’m a tax resident in the country?

Taxation in Italy is famously complex, often creating confusion about who's liable to pay taxes in the country and who isn't. But how do Italian authorities actually decide if you’re a tax resident?

Published: 17 September 2024 15:22 CEST
How does Italy decide if I'm a tax resident in the country?

Italy’s tax bureaucracy can be tough to navigate for Italians and foreigners alike, and situations such as frequent travel, vacation properties and remote work can all cause further confusion.  

Italian law defines a tax resident as anyone who lives in Italy for at least 183 days per calendar year (184 days in leap years). That includes anyone formally registered as a resident of Italy or simply residing here unofficially for more than half the year.  

Italian tax residents must pay tax on worldwide income, not just earnings generated in Italy. That’s why it’s especially important to know what the Italian tax office (Agenzia delle Entrate) considers when applying the 183-day rule – and how it knows how much time you spend in Italy.

The general rule  

For someone who splits their time among several places, the tax authority considers whether Italy is their “principal place” of business, economic interests and personal relations. According to a 2022 ruling from the Court of Cassation, Italy’s highest appeals court, officials look at whether the person owns property or businesses in Italy, has an Italian bank account, or has relatives here.

READ ALSO: Do I need to declare my foreign bank accounts to the Italian taxman?

If you don’t have European citizenship or an Italian immigration visa, you can only legally stay in Italy for 90 out of every 180 days. In that case, you probably won’t meet the 183-day rule.

Keep in mind, though, that the 183 days don’t have to be consecutive, and that short trips outside the country don’t necessarily count as not living in Italy for tax residency purposes if you have business and personal ties to the country.

Proof of residency

Tax authorities look at a variety of factors – some obvious and others less so – to determine how much time you spend in the country each year.

Anytime you enter or exit Italy directly to or from a non-Schengen Area country, your passport will be stamped, providing a record of how long you were in the country.

But given the EU’s open-border policy, tax authorities’ investigations go far beyond passport records.

Reports of wealthy Italians, especially celebrities, pretending they live in countries with a lower tax burden, like Monaco, have also forced the government to get creative.

In addition to property ownership and rentals, which are all registered with the government, tax authorities look at vehicle records, gyms and other club memberships, cell phone records, purchases for flights and train tickets to Italy, credit card use and postal records.  

In the case of celebrities, tax officials even use paparazzi photos and news stories to reconstruct a person’s movements; for the rest of us, social media posts and online activity can provide legally admissible clues about where we go and when.

Alternatively, if you’ve been accused of owing tax in Italy even though you spend most of the year in a different country, these are the types of records you can provide to show that you were actually living abroad.  

When in doubt, you can get a tax residency certificate from your home country stating you live and pay taxes there. If Italy has a double taxation agreement with the country, you will only be taxed in one place.

Paying tax on a holiday home

If you own a holiday home but live there for less than half the year, you will not become a tax resident of Italy simply by virtue of owning property here.

However, you’ll still need to pay any relevant property taxes and waste collection fees on the home.  

READ MORE: What taxes do you need to pay on a second home in Italy?

And any income that you earn in Italy – including from renting out a vacation home when you’re not there – is also subject to Italian taxation even if you’re not a tax resident.

Tax residency for digital nomads

In April, Italy introduced a new digital nomad visa for highly-skilled workers available to both freelancers and remote employees of international companies.

While the digital nomads will generally be legal residents of Italy who must pay tax in the country, some might qualify for a tax scheme for lavoratori impatriati (workers relocating to Italy), which only taxes 50 percent of their income.  

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