Italy – A Love Handbook
15th April 2025
Italy is a country that seems to defy reality with its extraordinary places that appear almost unreal. Every corner of this land speaks of history and priceless heritage. I am in love with this extraordinary and unique country, and I’m not alone. In 2024, Italy welcomed 458.4 million tourist arrivals, marking a 2.5% growth compared to the previous year. This number reflects the continuous rise in international tourism, drawn by the wealth and beauty of the Italian territory.
Italy that you eat and love
Love begins with beauty. It’s true that everyone has their own personal interpretation of beauty, yet there’s nothing more irreverent than objective beauty.
This is the case in Italy. Every corner is like a movie set: you walk among the ruins of Rome, get lost in the reflections of Venice, fall in love among the cypress trees of Val d’Orcia or in the elegant silence of Portofino. The architecture is pure emotion: domes that touch the sky, colonnades that tell ancient stories, cobbled streets where every step is a leap in time, recounting civilisations that contributed to the creation of Western society.
Here, even the geography is romantic: fiery sunsets over the sea, hills that seem painted, majestic mountains that embrace the sky. The food? It’s poetry, and the dinner table is the altar of everyday life.
Simple Emotions
The passion for art and life is everywhere, not just in museums: frescoes hidden in churches, statues that guard the squares, murals that tell the present. In Italy, beauty is not a luxury. It’s a lifestyle. And then there’s fashion, which here is not just worn but breathed. Elegance is natural and spontaneous. In Milan, it dictates the rules, but even the gentleman on a bike in Ferrara has his touch. Shiny shoes, scarves in the wind, sunglasses in the rain or sun – Italian style never goes out of fashion.
Relationships are the beating heart of life. Family is a powerful, noisy, and welcoming emotional universe. Time here has a different rhythm. A coffee isn’t grabbed on the go: it’s enjoyed standing at the counter, exchanging a few words with that barista who remembers your name. And then there’s history. But also the future. Every stone has a memory, every village has a legend, every city has a thousand lives. But Italy is not still: it is a creative laboratory made of design, technology, and brilliant start-ups.
Buying a Property in Italy
Italy boasts a solid real estate market and a constant demand, particularly in cities of art. The well-structured and protective Italian legal system offers security to investors, making this destination a preferable choice compared to less regulated emerging markets. This stability is key for those looking to diversify their real estate portfolio with a low risk of unexpected fluctuations. In 2024, the Italian property market recorded approximately 710,000 residential property transactions, showing a 7.6% increase in the 4th quarter.
There are also interesting returns, varying depending on the city, the property’s location, and the strategy adopted. Short-term rentals, for example, present a particularly profitable opportunity thanks to the large influx of tourists, with gross annual returns reaching 10%-12% for the short term and about 3%-6% for the long term ones.
Compared to other capitals, like the London of my heart, Paris, or Monaco, many Italian cities offer more affordable prices per square meter. This makes Italy an attractive destination for investors looking for less expensive opportunities without sacrificing quality and location.
Property Taxation
There are significant tax advantages if one can benefit from fiscal reliefs. For instance, the purchase of a first home benefits from a reduced registration tax of 2%, with minimal mortgage and cadastral taxes, but only if the property is located in the buyer’s municipality of residence or where they will move within 18 months of purchase. In this case, to benefit from the relief, the buyer should not own any other properties in the same municipality.
The purchase of a second home is subject to higher taxation, with a registration tax of 9%. If the property is luxury (categories A1, A8, A9) and is purchased through a construction company, the VAT rate increases to 22%.
Flat Tax
A special tax regime aimed at wealthy individuals who decide to transfer their tax residence to Italy. This includes international entrepreneurs wishing to settle in a European country with excellent quality of life, high-income athletes and artists who earn significantly from abroad, investors, and individuals with substantial wealth who want to optimise taxation on their foreign capital.
Those who transfer their tax residence to Italy, and have not been residents in this country for at least 9 of the previous 10 years, can opt for this regime, paying a flat tax of 100,000 euros per year, regardless of the amount of income generated abroad.
Furthermore, they are exempt from the IVIE (tax on overseas properties) and IVAFE (tax on foreign financial assets), if they are part of this scheme. The regime has a maximum duration of 15 years and it can be revoked or fall before this period, but it is not renewable beyond that time.
Renovation – Let’s go!
With the 2025 Budget, the Superbonus at 110% will no longer be valid for all interventions. The rate has been reduced to 70%, and the incentive will remain applicable only to specific types of interventions, such as energy efficiency and seismic improvements, albeit with significant limitations.
Additionally, the Superbonus will be exclusively available for single-family homes or condominiums that had already begun work before 2025, provided they meet specific deadlines. New requirements have also been introduced, such as the need for an Energy Performance Certificate (APE) and the improvement of at least two energy classes of the building to benefit from the incentive. While the Superbonus is still available, the conditions for utilising it have become stricter, and the reduced rate limits access compared to previous years. However, other fiscal incentives remain active alongside the Superbonus.
The Renovation Bonus offers a 50% tax deduction on expenses incurred for maintenance and restoration interventions, up to a maximum of 96,000 euros per property unit.
The Ecobonus provides a deduction of up to 65% for energy efficiency improvements, such as the installation of condensing boilers, high-efficiency windows, and solar panels.
The Furniture and Appliances Bonus offers a 50% deduction on purchases related to renovation works, with a maximum ceiling of 5,000 euros for 2025.
Finally, the Green Bonus provides a 36% deduction for the renovation of gardens, terraces, and private green spaces.
Bonuses and Tax Residence
Even those who are not tax residents in Italy can benefit from many of these bonuses, provided they own property in the country and are subject to IRPEF taxation in Italy, thus earning taxable income. If the beneficiary does not have a tax obligation in Italy, alternative options such as ‘cessione del credito’ or ‘sconto in fattura’, where provided by current regulations, can be considered.
With the 2025 Budget, significant changes have been introduced. For instance, for the renovation bonus, the 50% rate is reserved for those who use the property as their primary residence and have a real right on the same. Second homes or properties not intended for residence benefit from a 36% rate.
Therefore, Italian building bonuses remain an interesting opportunity even in 2025, even for those residing abroad. However, it is essential to carefully evaluate the requirements and one’s personal tax situation to understand how and to what extent they can be leveraged.
