Capital gains tax on property sold in Italy

The five-year test

The rule is article 67, paragraph 1, letter b of the income-tax code (TUIR), which classes gains from selling real estate as “miscellaneous income” in these cases: property acquired or built no more than five years before the sale. Three clauses shape the outcome.

• Inheritance. Property acquired by succession is excluded. A home you inherited and sell a year later does not produce a taxable gain under this rule.
• Main home. Urban units that were used as the seller’s or their family’s main residence for most of the period between purchase or construction and sale are excluded. The test is the majority of the holding period, not the day of sale. A home bought three years ago and lived in for two of them passes; one let out for most of the time does not.
• Donation. For a property received by gift, the five years run from the donor’s purchase date, not the date of the gift.

Building land is treated differently: the same letter taxes gains from selling land that can be built on under the planning instruments in force at the time of sale in every case, whatever the holding period. The Agenzia delle Entrate’s notary scheme covers “buildings and agricultural land” bought, built or received as a gift within five years.

After five years, an ordinary sale of a home produces no gain tax. That is why the date of the rogito (the notarial deed) and the date of your own purchase deed are the first two dates to write down.

Superbonus works

A separate letter of the same article, added for the Superbonus, taxes the gain on a property sold within ten years of the end of works that received the Superbonus, again with exclusions for inherited properties and for properties that were the seller’s or their family’s main home for most of the ten years (or of the shorter holding period). The same article 68 also changes the cost base of such works. It applies when the seller or the others entitled to the deduction carried out the works. See what happened to the Superbonus.

How the gain is computed

Article 68 says the gain is the difference between the price received in the tax period and the purchase price or construction cost, increased by every other cost inherent to the property. For a property received by gift, the starting figure is the donor’s cost, increased by the gift tax and later inherent costs.

Written as a formula: taxable gain = sale price minus (purchase price + inherent costs). As a calculation with arbitrary amounts, not market figures: if the sale price is P and the documented cost is C, the gain is P − C, and the 26% option gives a tax of 0.26 × (P − C). If P = €300,000 and C = €250,000, the gain is €50,000 and the tax would be €13,000. Which costs count as “inherent” (notary fees at purchase, agent’s commission, renovation invoices) is something the notary or an accountant should confirm against your documents; keep every invoice and bank transfer.

Two ways to pay the tax

The Agenzia delle Entrate states the option: whoever sells a property can ask the notary, at the time of the sale, to apply a substitute tax of 26% in place of income tax. The request is made at the deed. It covers gains on buildings and agricultural land bought, built or received as a gift within five years. It does not apply to gains that are capital income or that arise from professional activity, commercial business (including partnerships) or as an employee.

If you do not ask, the gain is declared in your income-tax return and taxed with your other income, at your ordinary rates. I did not read the income-tax rate scale for this guide, so ask your accountant to compare the two for your income. The comparison depends on your own figures.

A change coming in 2027

On 19 October 2026 article 67 is in force in the version cited here. Normattiva shows that, in the version applying from 1 January 2027, the article is marked as repealed by Legislative Decree 117/2026, which rewrites the rule. Payotte has not read the new text, so it cannot say whether the rules above are restated unchanged. Treat any sale dated after 31 December 2026 as needing a fresh check of the rule with a notary or tax adviser.

Non-residents and foreign taxes

The rules above concern the Italian tax on the property. A seller who lives abroad may also have to report the sale at home, and a tax treaty may decide where the gain is taxed and which credit applies. I read no treaty text for this guide; see selling as a non-resident owner and check the treaty between Italy and your country of residence on its government’s site.

Which professional to consult

The notary applies the substitute tax if you ask for it, and the Notariato notes that notaries collect taxes linked to transactions on behalf of the State. For the choice between the two methods and for foreign tax, use an accountant (commercialista) or tax adviser; this is not a trade Payotte lists. A surveyor can document works that add to the cost base.