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All you need to know about annual property tax (IMU), what it is and how is it paid.
Many of you will be aware already of a property tax that owners of second homes and primary luxury homes in Italy have to pay every year, which is called IMU.
IMPORTANT: Unlike in other countries, you will not receive a bill or reminder from your municipality for your IMU payments. Therefore the responsibility is placed on the homeowner for ensuring that they take action to calculate and pay the relevant amount of IMU accordingly every year.
IMU EXEMPTION: Because IMU is a tax on second homes, primary residences are exempt – unless they are luxury properties categorised as A1, A8 or A9 in the land registry. A “primary residence” is considered to be the real estate unit in which the “taxable person” (e.g. the owner) and family formally reside and usually live.
REDUCED IMU RATES You may be able to benefit from a 50% IMU reduction for buildings of historic or cultural interest, buildings registered as uninhabitable and/or uninhabitable and not in use.
HOW TO CALCULATE IMU
IMU is classed as a local tax; so each Municipality can charge an extra tax rate in addition to the standard national rate, according to specific parameters established by law every year. Therefore, the amount of IMU to be paid for similar property can vary from one Municipality to another, from one year to another.
The following information is needed in order to calculate the IMU:
- 1) Taxable value of the property and outbuildings such as garage, parking space, cantina (rendita catastale).
- 2) Category type A is for homes, C is for accessories such as garage or parking space C6, storage room C2.
- 3) Current IMU tax rate (aliquota) applied by the Municipality where the property is located.
- 4) Cadastral coefficient values by cadastral category
- The first two can be found easily on the property certificate (Visura Catastale). This information is also contained within title deed, and if you bought your property through us, we will be happy to provide you with an updated Visura, as well as explain to you where to find this information.
- The IMU tax rate (aliquota) applied by Municipality can usually be found on their website or by visiting the Municipality treasury office (Ufficio Tributi) and the cadastral coefficient values can be found by referring to the tax office website Agenzia delle Entrate.
- Now follow these steps:
- Revalue the taxable value by 5%
- Multiply this figure by the coefficient corresponding to the cadastral category for each building (apartment, storage room, garage etc).
- Multiply the result obtained by the IMU rates set by each municipality.
- CALCULATION EXAMPLE
- An apartment in category A/3 with a taxable value of €609,42:
- Property tax value €609,42 + 5% revalued annuity = €639,89
- €630 x 160 (coefficient for category A/3) = €102,382,56
- €102.382,56 divided by 1000 by 10.6 = €1085.425 (we applied an IMU rate of 10.6% set by the municipality)
- €1085.43 is thus the IMU amount payable in two equal instalments.
- Gathering the information, making the calculation and filling in the F24 is not always easy. Even Italians find it difficult despite usually having the relevant information to hand as well as language on their side!! Hence many pay for professional assistance for peace of mind.
- METHOD FOR PAYMENT
- IMU is paid in two instalments: the retainer and the balance (acconto and saldo). Payments are due respectively by 16 June (acconto IMU) and 16 December (saldo IMU) of each year.
- HANDY TIP: It is possible to make one single payment by June 16, and we frequently advise our clients to do this to make things easier.
- IMU is paid by means of a standard tax form (modulo F24) that can be found at any bank branch or post office. If you have an Italian bank account the F24 form can also be completed in the online banking section. You will need the code for the Municipality which is a letter followed by 3 digits, to be found on the visura, as well as the tax code, usually 3918 to be used for payment of IMU.
- Fortunately here in the Lake Garda area, we have found that most municipalities will accept an electronic bank transfer for the amount if you are paying from overseas, or in the case that you do not have an Italian bank account or are unable to pay via the tax form in person at your bank or post office.
- We manage many IMU payments on behalf of our international clients. If you need assistance with your IMU calculation and advice regarding payment, do not hesitate to get in touch to see how we can help you.
