2024 Budget Bill
The 2024 Budget Bill introduces significant changes regarding the taxation of short-term rentals and capital gains arising from the sale of properties that have benefited from the superbonus. Here is an overview of the main provisions:
Taxation of Short-Term Rentals:
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Increase in the Tax Rate: Article 18 of the Budget Bill proposes an increase in the tax rate for short-term rentals. The current rate, which stands at 21%, will be raised to 26% if more than one apartment is allocated for short-term rental during a fiscal period.
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Withholding Tax: If more than one apartment is allocated for short-term rental during the fiscal period or if one does not opt for the flat-rate tax regime, a withholding tax will be considered an advance payment.
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Non-Resident Entities: Non-residents with a fixed establishment in Italy, who receive rental payments or engage in the payment of such rents, fulfill their tax obligations through their fixed establishment.
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Non-EU Resident Entities: Non-EU residents with a fixed establishment in a European Union member state, who receive rental payments or engage in the payment of such rents, meet their tax obligations through the fixed establishment. If these entities are recognized as lacking a fixed establishment in a European Union member state, they are required to appoint a tax representative to fulfill tax obligations. In the absence of the appointment of a tax representative, residents within the territory of the State who belong to the same group as the aforementioned entities are jointly liable for the withholding and payment of the tax on the amount of the rents specified in the contracts.
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EU Residents without Fixed Establishment in Italy: EU residents recognized as lacking a fixed establishment in Italy can directly fulfill their tax obligations or appoint a tax representative.
Capital Gains from Properties Benefitting from Superbonus:
The same Article 18 of the Budget Bill amends Articles 67, paragraph 1, and 68, paragraph 1, of the Italian Tax Code (Tuir), extending the cases where a capital gain arises for the sale of properties as of January 1, 2024, which have benefited from interventions eligible for the superbonus.
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For properties that have undergone redevelopment interventions up to 110%, completed no more than ten years before the sale, the capital gain of 26% is calculated taking into account the increased value due to the renovation work.
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Properties acquired through inheritance and those used as the main residence of the seller or their family for most of the ten years preceding the sale, or for a significant part of that period if less than ten years have elapsed between the purchase or construction date and the sale, are excluded.
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For properties where the eligible interventions have been completed no more than five years before the sale, the expenses related to these interventions are not taken into account if the incentive has been used at the rate of 110%, and the respective options have been exercised.
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If the eligible interventions have been completed more than five years before the sale, the calculation of the costs associated with the property takes into account 50% of these expenses if the 110% incentive has been used, and the previous options have been exercised.
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For properties acquired or built on the date of sale, more than five years have passed, and the purchase price or construction cost, calculated in accordance with previous periods, is adjusted according to changes in the consumer price index for blue-collar and white-collar workers' families.
For the capital gains mentioned above, a 26% substitute tax can be applied.
