Italy: Living There - Tax Issues
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Living There
INDIVIDUAL TAXATION
Residents in Italy are taxed on their worldwide income. An individual is resident in Italy if he is registered in the Civil Registry or has established his principal centre of business or has his habitual abode in Italy. Married couples may be taxed separately depending on the conditions set on the marriage contract.
INCOME TAX
Income is taxed at progressive rates. Taxable income is generally an aggregate of all kinds of income, less income generating expenses and allowed deductions and allowances. A regional surtax is also imposed on income, ranging from 0.9% to 1.4%, along with a municipal surtax and a provincial surtax, determined by each municipality and province at an aggregate up to 0.8%.
INCOME TAX RATES 2008 |
|
| TAXABLE INCOME, € | |
| Up to €15,000 | 23% |
| €15,001 - €28,000 | 27% on band over €15,000 |
| €28,001 - €55,000 | 38% on band over €28,000 |
| €55,001 - €75,000 | 41% on band over €55,000 |
| Over €75,000 | 43% on all income over €75,000 |
| Source: Global Property Guide | |
CAPITAL GAINS
Gains from the sale of real estate property are not taxable if the property was held for more than five years. If the property was held for less than five years, the gains are taxed as income. Taxable capital gains are computed as selling price less acquisition costs and related expenses. Gains from the sale of a primary residence are not taxable.
PROPERTY TAX
Municipal Real Estate Tax
A municipal real estate tax is imposed on the estimated value of a property, depending on its classification under their rules, multiplied by a given multiplier, which varies according to the type of the property. The rate is set annually by each municipality and ranges from 0.4% to 0.6%.
Italy - more data and information
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