Italian And Cross Border Legal Specialists. De Tullio Law Firm.

Expertise in Italian and cross border law

At De Tullio Law Firm we provide independent legal advice in all areas of the law. The majority of our work focuses on managing a wide range of Italian and cross border legal matters. We are specialists in property, family and inheritance law.

A passion for the law led us here

De Tullio Law Firm: Combined experience of 55 years

Giovanni De Tullio. Founding Partner at De Tullio Law Firm.

Giovanni De Tullio founded De Tullio Law Firm in 1965. In addition to being a lawyer, Giovanni was a notary (notaio) for over 30 years. As a result, Giovanni brings tremendous experience and knowledge of Italian legislation to the team. Whether clients are purchasing or selling a home, gifting a home to a child, making a will or incorporating a company in Italy, Giovanni’s understanding of the Italian State’s requirements is an invaluable resource.

Following in his father’s footsteps, Giandomenico De Tullio also became a lawyer.

Giandomenico De Tullio. Managing Partner.

After a decade working overseas at international legal firms, as well as at the European Commission, Giandomenico joined Giovanni at De Tullio Law Firm.

Aside from being a member of The Italian Bar Association, Giandomenico is also a full member of Society of Trusts and Estate Practitioners. STEP is the world’s leading professional body for practitioners in the fields of trusts, estates and related issues.

Giandomenico is also an active representative in a number of not-for-profit government organisations whose aim is to develop and promote economic and cultural relations.

Right beside you

Because we have over 55 years of experience providing independent legal advice, we understand that property investments, or planning inheritance is not just a complex legal journey but also a personal one.

Our knowledge of Italian and cross border property, family and inheritance law gives us unique insights into the processes involved. We pride ourselves on giving each of our clients the individual care that their case deserves.

Thanks to the dedication of our lawyers, associates and professional staff, we offer an extraordinarily high level of service, responsiveness and attention to detail.

Our clients come from all over the world

Clients include both individuals and companies seeking legal advice, support and services. Our multi-lingual team serves clients throughout Italy.

Finally …

Thank you for visiting our website. We hope you find the information useful. If there is anything you would like us to cover in an article or, if you would like to discuss a legal matter with us, please get in touch. We look forward to hearing from you.

Cura Italia Decree. March 2020

Wide-ranging central bank and government policies and stimulus packages are supporting the economy during the COVID pandemic. The Italian government has moved quickly to activate a fiscal package to support businesses and individuals through the crisis.

The measures introduced in the “Cura Italia Decree” take a three pronged approach. Firstly, they aim to reinforce the health sector through these difficult times. Secondly, they help alleviate the impact of the COVID pandemic on business in general and thirdly they support daily life for individuals and families.

Below we summarise some of the measures included in the Cura Italia Decree.

Cura Italia Decree. Suspension of payments

VAT registered companies and professionals with their fiscal domicile, registered office or place of business in Italy, whose turnover did not exceed €2 million in the fiscal year preceding the entry into force of the Cura Italia Decree, are eligible to defer the following payments:

– VAT (balance due on the VAT return and payment due on February 2020)

– Withholding Tax on employee / similar  income

– Social Security Contributions

These payments are now due by 31/05/2020 either in full or they can be made in 5 equal instalments starting from May 2020. No interest or penalties are applicable.

Cura Italia Decree. Suspension of obligations due between 08/03/2020 – 31/05/2020

 

  Previous Due Date New Due Date
VAT Return 30/04/2020 30/06/2020
TR Form 30/04/2020 30/06/2020
Esterometro (Jan./Feb./ Mar.) 30/04/2020 30/06/2020
Intra Form 25 monthly taxpayer or quarterly 30/06/2020
SSP Form 30/04/2020 30/06/2020
EAS Form 31/03/2020 30/06/2020

Dates for Income tax returns have not been extended and must therefore be submitted on 30/11/2020 and 30/06/2020 respectively.

There have also been no changes to income tax payment deadlines. That is to say, based on the self-assessment system, payments are due in June (30/06/2020) and November (30/11/2020) respectively.

Regarding companies, the Cura Italia Decree provides an extension for approval of financial statements to 180 days from the end of the financial year. In addition it allows for a deferment of tax payments. Given travel restrictions, annual general meetings to approve financial statements can move online via for example, video-conferencing.

  Date Income tax payments
Approval within 120 days from end of 2019 30/04/2020 (regular) 30/06/2020 – 30/11/2020
Approval within 180 days from end of 2019 28/06/2020 31/07/2020 – 30/11/2020
Approval within 180 days from end of 2019 (maximum add 30 days) 28/07/2020 31/08/2020 – 30/11/2020

IMU (property tax), payment deadlines also remain as is: 16th June, 2020 and 16th December, 2020.

Cura Italia Decree: Suspension of payments due between 2/3/2020 – 30/04/2020 for hospitality and leisure sector

The government has extended payments by one month for companies in the tourism-hotel sector with reference to VAT, withholding tax, social security contributions. However, these tax liabilities must be paid in full by 31/05/2020 or in 5 instalments from that date.

Cura Italia Decree: Payments to Tax Collection Agency (Agenzia Riscossione)

The Cura Italia Decree provides for the suspension of tax payments due in the period between 08/03/2020 and 31/05/2020 arising from bills issued by Tax Collection Agencies.

In addition, a suspension also applies to notices issued by the Italian Customs Agency as well as injunctions and further collection notices issued by municipalities or local authorities.

Furthermore, a suspension also applies to payments of facilitated settlement of tax bills (Rottamazione-ter). Instalments due in February will now therefore be payable on 31/05/2020.

Other liabilities

Payments on debts to other collection agencies (Agenzia Riscossione) including for instance INPS and Italian Customs that are payable between 8/03/2020 – 31/05/2020 have been deferred until 30/06/2020. However, suspension of payments does not extend to payment reminder notices from the Italian tax authority (Agenzia delle Entrate).

Other measures

A tax credit of 60% on rent for commercial premises (cadastral category C/1) for March 2020.

Companies can activate lay-off procedures. The Cura Italia Decree includes provisions in order to support employers who are facing a reduction or suspension of activities due to the Covid-19 emergency. This means employers can use a simplified procedure to apply for ordinary social security funds (cassa integrazione) for employees who were already employed by 23 February 2020. This support lasts for a maximum of nine weeks and, in any case, no later than August 2020.

In consideration of the lockdown of several economic sectors in Italy, additional indemnity payments for registered VAT self-employed entrepreneurs or professionals who do not benefit from specific social security coverage have been agreed. Payments of Euro 600.00 per month in lieu of income. Although procedures have yet to be announced, the payment of this allowance will be borne by INPS.

Requests for a suspension of first home mortgage payments is to be made to the relevant credit institution.

Finally …

While this summary does not provide an exhaustive explanation of the contents of the Cura Italia Decree, it aims to provide a brief overview of the measures that the Government has adopted. Although details regarding the implementation of measures are pending, each of the measures has specific requirements that will be implemented by provisions issued on a ministerial and regional level. Get in touch for additional information.

You may also like to read about how the pandemic has impacted the Italian property market.

Budget Law 2020 – Tax Measures

Income Tax ReliefBudget Law 2020 – Tax Measures

In order to foster economic growth, art. 5 of, “Decreto Crescita” came into effect in December 2019.

Legislation provides for significant changes to the income tax system for anyone who transfers their tax residence to Italy from 2020.

The law is retrospectively applicable to anyone who transferred their tax residence to Italy from 30th April 2019.

Who can benefit from tax measures in the Italian budget law?

Legislation on income tax now extends to foreign football players and other professional sportsmen and women. The law establishes a 50% reduction on income tax. It applies for 5 years provided the sports professional maintains their tax residence in Italy for at least two years. For those not from the sports arena, tax relief of 70% is also available. If for example you generate an income in Italy through employment, self-employment or from business start-up activities.

Income tax relief of up to 90% is available for those who transfer their residence to one of the following regions: Abruzzo, Molise, Campania, Puglia, Basilicata, Calabria, Sardinia, Sicily.

In order to take advantage of tax benefits, certain conditions apply. You can transfer your tax residence so long as you were not resident in Italy for the previous 2 tax years. You must undertake to reside in Italy for at least 2 years and, your work-related activity should mainly be in Italy.

There is no requirement for Italian citizens returning to Italy as tax residents from 1st January 2020 to have previously been registered with AIRE (the Registry Office for Italian Citizens Residing Abroad).

Tax relief is applicable for 5 tax years. However, a 50% income tax reduction is available on income you generate in Italy for a further five tax years if you have at least one minor or dependent child. This also applies if the child is in pre-adoptive foster care.

In addition, you must become the owner of at least one residential property in Italy. Your property purchase can take place either following your transfer to Italy or in the twelve months preceding your transfer. You can purchase property in your name, a spouse or partner’s name, in your children’s name or in co-ownership.

High net worth individual tax system

The 2017 Stability Law remains in force regarding foreign income from real estate investments, dividends, capital gains and other income.

This high net worth individual tax regime  is available if you have not been a tax resident in Italy for the nine (out of ten) years prior to transferring to Italy. The advantage consists in paying a substitute tax of € 100,000 on all income derived from abroad. Sports professionals (football players, basketball players, etc.) can benefit from this tax system.

Flat Tax

The Stability Law of 2019 includes a flat tax regime. This regime is aimed at individuals with a pension or another source of income from outside Italy. You can transfer residence to certain municipalities in the south of Italy and, provided you were not resident in Italy in the five previous tax years, you can opt to pay a flat-rate tax of 7% on your income from abroad.

Building-related taxes

Deductions for energy re-qualification (65%), building renovation (50%) and furniture and household appliance bonuses (50%) concerning the purchase of new furniture for renovated buildings are available.

A new “Facade Bonus” allows for 90% deductions on documented expenses relating to refurbishing or restoring external facades of buildings. As any work to facades must comply with technical regulations, work needs prior assessment and permission.

Capital Gains

The budget law also introduces changes to real estate capital gains. A substitute tax is available if a principal residence or a second home sale meets certain conditions. The substitute tax starts at a rate of 20% on sales of properties that took place until 31 December 2019. It rises to 26% for property sales from 1 January 2020. The application of this regime is optional and should be requested by the notary on the date set for the completion of the sale.

Company shares

The budget law offers terms for recalculating the value of investments in unlisted companies up to January 1, 2020. The drafting and certification of the appraisal, as well as the payment of the substitute tax is due by 30 June 2020.

These terms only apply to private individuals with equity investments unrelated to business operations. In particular, the aforementioned legislation allows the revaluation of equity investments held in companies not listed on regulated markets. Individuals must hold investments at 1 January 2020 and require a sworn appraisal report by 30 June 2020 when the substitute tax of 11% is payable.

Company assets

The budget law allows the revaluation of company-owned assets. Based on 2019 financial statements, the law introduces reduced substitute tax rates:

– from 16 to 12 per cent for depreciable assets;

– from 12 to 10 percent for non-depreciable assets.

In addition, a new provision allows companies to release credit balances recorded in their accounts against the recognition of higher values ​​at a rate equal to 10%.

This option does not concern IRPEF entities with simplified accounts.

New IMU

The budget law introduces a new version of IMU. It sees the merger of former property tax IMU (Imposta Municipale Propria) and the municipal service tax  TASI (Tributo Servizi Indivisibili) to create a new IMU (Imposta Municipale Unica) tax.

Finally …

With over 55 years experience of cross border and Italian property transactions, we understand that Italian property-related tax matters can be confusing. If you would therefore like further clarifications or want to discuss your situation, please contact us for a free consultation. We are here to help. 

 

You may also be interested in Do beneficiaries have to pay taxes on inheritance?

Safety Requirements on Home Renovations in Italy

Renovating an Italian property. Health and safety law

Who is liable for compliance with safety requirements on home renovations in Italy?

In the case of even minor construction work the, “works manager” is responsible for safety. This is usually an architect, engineer or designer. However, if the owner of a property directly procures the services of a worker, the homeowner is acting as the works manager.

This means that the homeowner is responsible for safety. Likewise if there is an accident, the homeowner is liable to criminal and civil consequences.

Imagine you hire a plasterer to render a wall and the plasterer falls off a ladder. Or, you find an electrician to rewire your property and the electrician gets electrocuted.

You, as the homeowner, are liable. Even if you are not around at the time of the accident. As the legal owner of the property, in the eyes of the law, you are the employer of the injured worker.

The risk of criminal and civil prosecution

Your liability for the accident is not only of a criminal nature, for culpable injuries caused to the worker, but also of a civil nature.

In other words, you may be liable to pay compensation. Compensation for a broken limb can amount to several thousand euros. In a worst-case scenario, compensation may be enough to see your property seized.

This is a very intricate legal issue based on technicalities regulated by Italian law. If you are planning refurbishment work on your property in Italy, make sure you meet  safety requirements.

Homeowner liabilities

When planning refurbishment works, such as renovations or painting, you are legally responsible for ensuring safety requirements.

Italian law takes the view that anyone regarded as, “non-professional”, such as a homeowner, who procures the services of a third party to carry out any type of home improvement, is responsible for ensuring that workers operate in accordance with health and safety legislation.

Safety requirements. A case study

Recently, the Supreme Court examined an appeal filed by a homeowner plaintiff who had commissioned a construction company to paint the exterior walls of a cottage. During the work, a painter fell through a hole in the paving. The painter fell several metres into the basement and tragically later died. The hole that caused the accident had previously been covered with boards. However, the boards had been removed by another worker and replaced with polystyrene, which was not strong enough to bear the weight of the painter.

The court of appeal upheld previous rulings which established that the homeowner had a duty of care in relation to the execution of the contract. In this case, the court identified several failures. In the first instance, the absence of a risk assessment plan. Secondly, a lack of maintenance on walkway around the cottage and risks posed by the opening into the basement. Thirdly the court considered that there had been a failure to supervise and inform workers at the property.

Safety requirements are an employer’s responsibility

The court found the homeowner at fault for these failures. Safety obligations are the exclusive competence of an employer, who in this case was the homeowner. In effect, the homeowner was acting as the painter’s employer. While the work was of a “domestic” nature, the court found that the homeowner was not exempt from performing the duties of works manager. In other words the accident occurred because of the homeowner’s failure to take responsibility for his employee’s safety. And the homeowner’s negligence to act in the role as designated works manager.

In cases such as this, it is, therefore, crucial to underline the homeowner’s obligation to point out any dangers on site and wherever possible, to provide for their elimination before work starts. Unless a homeowner can prove they exercised a duty of care and took all measures to provide a safe working environment, they will be held liable.

Health and safety requirements in Italian building contracts

When a homeowner engages a contractor, it is important to have a written contract. This should indicate that compliance with safety regulations is the contractor’s responsibility. This way it becomes clear, from a legal point of view, that the contractor is responsible for safety on home renovations in Italy.

Finally …

Whether you are building a new property in Italy, or renovating an existing Italian property, having the right building contract is vital to ensure that everyone involved knows their rights and responsibilities.

De Tullio Law Firm is a legal firm present throughout Italy. We have over 55 years of specialist experience dealing with issues related to property, construction and renovation matters. If you are thinking of undertaking building or refurbishment on your property in Italy, or if you are in a difficult situation concerning liabilities and safety requirements through refurbishment work, we are here to help. Get in touch with us at: info@detulliolawfirm.com

 

You may also beinterested in Off-plan property in Italy – Where do you stand legally?

Benefit of Inventory. Accepting An Italian Inheritance

How to protect your personal assets from debts associated with an Italian inheritance

At De Tullio Law Firm, we understand that when a loved one dies there are many issues that need attention at an extremely difficult time. Having to make funeral arrangements, notifying friends and family and the grieving process.

On top of this, there are also critical legal matters that require consideration.

If your loved one left assets not only at home but also in Italy, estate administration is more complex. As cross border legal specialists in Italy, this is an area in which our legal team can help. Should you wish to discuss your situation with us, please get in touch.

Italian estate inheritance options available to heirs

Inheritance consists of assets (moveable and immovable property) and liabilities (debts).

Italian law stipulates that an heir becomes responsible for settling any debts the decedent may have left.

The acceptance of an inheritance sometimes presents a risk. If the value of assets included in the inheritance is less than liabilities, heirs are responsible for settling debts from their personal finances.

In Italy, inheritance always requires acceptance or refusal. Italian law provides three inheritance options in this regard.

Unconditional acceptance of the inheritance

An heir inherits all the assets subject to succession. The beneficiary assumes personal liability for the decedent’s liabilities, even if debts exceed the value of the assets. An heir therefore becomes liable in a personal capacity (with their own finances) for any portion of the decedent’s debts that the inheritance does not cover.

Refusal of the inheritance

This means an heir completely renounces the succession. In effect, an heir renounces all rights to the inheritance. The statutory arrangement is that the share of inheritance is then subject to a ‘right of representation’. Thus it passes to an heir’s children, and if there are no children, to any other heirs.

Acceptance under the benefit of inventory (accettazione con beneficio di inventario)

This is usually the best option if you are uncertain whether the inheritance comprises debts and other succession charges.

What is the acceptance of inheritance under benefit of inventory?

According to Article 490 of the Italian Civil Code, acceptance under the benefit of inventory is an act by which a person declares the acceptance of inheritance but wants to protect personal assets from becoming entwined with those of the deceased.

Usually, the assets of the heir and that of the deceased are merged into one, so not only does the heir inherit movable and immovable assets, but also any debts and liabilities.

Whoever accepts an inheritance must settle debts, so caution is advised. In order to protect an heir’s personal assets, the acceptance of the succession is subject to a condition, the benefit of inventory. This permits the heir to assess what the inheritance actually comprises before deciding whether or not to accept it.

There is no obligation for an heir to accept the inheritance. Drawing up an inventory of debts and assets allows the heir to make an informed decision about the inheritance: either to accept and pay debts from the assets inherited, or to refuse the inheritance because debts outweigh inherited assets.

Effects of acceptance under benefit of inventory

The first advantage is that the estate of the deceased remains distinct from the estate of the heir. In essence, this means that an heir does not have pay the decedent’s debts for a value greater than that of the inherited assets. In addition, creditors cannot recoup any debts from the heir’s personal assets.

How to accept the inheritance under the benefit of inventory

To accept an inheritance using the benefit of inventory, there are some fundamental requirements. Article 490 of the Italian Civil Code covers the procedure.

Firstly an heir has to file a declaration written in Italian, with a notary or a clerk of court in the locality where the succession procedure is taking place. Secondly, a detailed inventory of all the assets belonging to the inheritance is necessary.

Within a month of filing the above mentioned declaration, the notary or clerk must transcribe it in the relevant land registries. This transcription then permits the heir to pay the creditors and the bequests.

Finally …

If you are in the difficult situation of considering whether to refuse or accept an Italian inheritance, using the option of benefit of inventory may be the way forward for you.

You may also be interested in Inheritance Law and Taxes

Title deed in Italy. Change of Names.

Registering names on a title deed in Italy

The final step of the Italian conveyancing process is signing of the deed of sale. In effect this is a property title deed and transfers ownership of real estate into someone’s name.

This legal procedure demands the presence of a notary public, the real estate vendor(s) and buyer(s) and two witnesses.

The notary reads aloud the entire deed, which is written in Italian. All parties, including the witnesses and the notary public, then approve and sign the title deed.

If one of the parties to the transaction is not fluent in the Italian language, Italian law requires the presence of a qualified professional to translate and interpret the title deed. This could be a translator or a bilingual property lawyer. This legal requirement aims to ensure that all parties fully understand the content and ramifications of the deed. The professional acting as translator must also sign the title deed.

Once the notary has signed-off on the deed, the buyer acquires ownership of the real estate.

Subsequently, the notary is responsible for certain formalities. Because notaries work for the Italian State, registering the deed with the tax authorities is the first step. Next the notary lodges the deed in the Public Registers. This allows any third parties who may have an interest to know about the change of ownership. Lastly, the notary informs the land registry so they can update their records accordingly.

How do you change the name on an Italian property / title deed?

There are many reasons why you may need to change the name on a title deed in Italy. Divorce and death are the most common reasons.

In order to change the name on a title deed, you will require a new notarial deed.

For example, if you acquired a property with a spouse and following a divorce you need to remove one of the names from a real property title deed, you will need a new notarial deed.

Where the divorce decree is from an Italian Court, the transfer of ownership will not involve payment of any real estate transfer tax.

If on the other hand, the divorce decree is issued by a non-Italian Court, you will have to pay real estate transfer tax.

The terms of the new title deed determine applicable tax rates. It will depend whether the real property changed hands without any payment or if there was a financial transaction involved. In the latter case, you will need a new deed of sale.

How do you find out whose name is on a title deed in Italy?

In order to find out whose name appears on a title deed, you will need to conduct mortgage and cadastral searches.

Finally …

For more information and clarification or, if you need to change a name on a title deed or ascertain whose name is on a real property title deed, feel free to get in touch with us. We are here to help.

You may also like to read: Translating legal documents in Property Transactions

Illegal Construction in Italy (abuso edilizio)

Do you own an Italian property that completely or partially lacks planning permission?

Illegal construction in Italy is not uncommon. The Office for Italian Statistics (ISTAT), estimates that nationally, some 20% of Italian properties are completely illegal builds.

On top of these statistics, many properties are partially illegal. For example, an outbuilding or extension that doesn’t have planning permission.

Before buying any Italian property, you should conduct planning searches in the land registry and municipal planning records. It’s crucial to check that the whole property has all the relevant building consents.

If you are building a property in Italy, you should make sure that you have all the relevant permits and authorisations.

We advise that you seek independent legal advice to avoid the risks of prosecution and buying a property that is later unsaleable.

What is illegal construction?

Illegal construction, “edilizia abusiva” in Italian, is a crime.

If you make changes to a property without relevant consent or, you carry out building work which does not comply with permits, you are breaking the law.

Building work is also illegal if notification of commencement of work notice is missing (comunicazione di inizio lavori, CIL). This is a formal notification by the owner of the property to the municipality regarding the intention to make a change to the internal layout of a building.

There are several categories of illegal construction in Italy

Construction of an entire building without a building permit. This also applies to buildings on land in non-building zones.

An extension to an existing property without a building permit.

Work that diverges from the building permit issued.

A change of use to the property, for instance from business to residential use.

Any internal work without a required CIL notification.

Who is accountable for illegal construction work?

Those at risk of prosecution for Italian planning violations are the person named on a building permit if work is non-compliant with said permit.

Whoever commissioned the work. This may not necessarily be the property owner.

The builder or person who carried out the illegal work or the project manager may also be held liable.

It is also worth noting that if a new owner either commissioned or instigated the vendor to carry out certain illegal work prior to purchasing the property, both parties may be liable.

What are the risks of illegal construction in Italy?

The first possible consequence of commissioning illegal construction is the imposition of an administrative sanction. These vary according to the type of illegal work carried out. Possible administrative sanctions include a demolition order. This would entail removing all illegal building work and restoring the property to its original state.

If the municipality does not issue a demolition order, it may sequester the property and the owner will be given a fine. This will equate to the value of the illegal work or the estimated market value of the work.

Work that diverges from a permit or work done without a CIL notification is subject to a fine. Fines start at 516 Euros. However they can equate to twice the increase in the estimated market value of the property based on the work done.

Provided work complies with planning and building regulations in force at the time the work was carried out, it may be possible to apply for retrospective building permission.

The criminal consequences of illegal construction in Italy

Illegal building work is a criminal act in Italy. As such, it is therefore potentially punishable by arrest and a custodial sentence. More frequently however punishment involves hefty fines.

The penalties vary, depending on the type of crime committed and are in addition to previously mentioned administrative sanctions. More specifically, in the event of non-compliance with building regulations, town-planning laws and building permits, the fine is exclusively pecuniary – up to 10,329 Euros.

In the case where building work differs from a building permit, offenders could face a custodial sentence of up to two years plus a fine ranging from 5,164 to 51,645.00 Euros. Likewise if construction lacks a permit or, despite a work suspension order, work has continued.

Illegal construction on land with no zoning for building purposes can involve a custodial sentence of up to two years and a fine of between 15,493 and 51,64.00 Euros. The same penalty is applicable where illegal building work has been carried out in areas with historical, artistic, archaeological, landscape and/or environmental restrictions.

Finally …

Property buying in Italy is a serious investment. Italy has unique real estate laws and local customs. We recommend having the right team of advisors in place to make your purchasing experience successful. Should you need further information or help concerning illegal construction, please contact us.

You may also like Preliminary Contracts in Italian Property Purchases

Elective Residence Visa for Italy

An Elective Residence Visa allows non-EU citizens to reside in Italy

You should submit your application for an Elective Residence Visa (ERV) to the Italian embassy or consulate in your home country. For example, U.S. citizens can apply to the Italian consulates in New York, Miami, San Francisco. Canadians should apply to the Italian consulates in Toronto or Montreal.

The main requirement for obtaining an ERV is that the applicants must be able to support themselves autonomously in Italy. This must through an income unrelated to employment. Your income must be sufficient to exclude recourse to the Italian welfare system.

Applicants for an Italian ERV must be able to provide documented guarantees

According to Italian law, ERV applicants should meet two essential elements. Firstly, they must have somewhere to live in Italy. This can either be a property they own, or a secured tenancy with a contract.

Secondly, applicants must have an income stream. This should be approximately Euro 31,000 per annum. This income must continue in to the future – for the period of stay in Italy.

Verifying that an ERV applicant has somewhere to live is fairly straightforward. However, the assessment regarding adequate finances implies a so-called discretionary evaluation by the consulate.

By law, this assessment cannot be  arbitrary. In other words, the applicant must be able to see a logical explanation behind the decision-making process.

The law sets out various principles which the consulate should take into consideration when deciding whether or not to grant an ERV.

In particular, the available financial resources should be “ample”, “autonomous” and “stable”, thus the applicant should be able to sustain himself/herself without working in Italy.

The above means that financial resources should be fully accessible to the applicant. And, that funds should not be subject to unexpected, sudden fluctuations. The consulate must be able to make a reasonable assumption that an applicant’s financial resources will also exist into the future.

The applicant’s financial resources should originate from pensions, life annuities, ownership of real estate, ownership of stable economic-commercial activities or other sources of income. Income cannot however be from employment.

In the absence of any logical, valid and concrete reasons, so long as an applicant for an ERV meets the above requirements, the consulate cannot refuse to grant an ERV.

Finally …

Do you think your ERV application was wrongly rejected or do you need help with an ERV application?

The evaluation of the elements for an ERV application by the consulate is discretionary. However, as previously mentioned, it cannot be arbitrary.

Should you need further information concerning an elective residence visa or preparing your application or, if you wish to appeal the denial of an ERV, please contact us.

Usucapione (Adverse Possession)

What is Usucapione?

Usucapione is a legal method of acquiring ownership of an Italian property.

There are two essential elements to  usucapione. Firstly, material possession of the asset, acting as the owner (as opposed to someone who received the right of use from the owner, e.g., by  means of a contract). Secondly, the passage of a specific period of time.

In the context of usucapione, possession should be peaceful. That is to say, possession should not have occurred through violent or clandestine means. Possession should also be continuous and uninterrupted over time. This means that possession should not have been intermittent.

Time is the essential element in usucapione. Italian legislation provides for 20 years for properties where possession is in bad faith and for other rights concerning usufruct, right of use, easements, etc. 10 years if the property is in good faith, that is, with a registered title deed by a party who was not the real property owner;

Uninterrupted possession must occur during the above mentioned periods of time. How does the law define uninterrupted? It means that possession should not be vacant for more than one year. For example, if the owner takes back possession of his asset for more than one year, usucapione is considered interrupted.

According to case law, it is compulsory to provide clear evidence concerning the start of possession. Very often witnesses play a crucial role.

Not all assets are subject to usucapione. State-owned property and/or public assets, for example, cannot be adversely possessed.

A case of usucapione?

For years a house had sat abandoned on the outskirts of a Sicilian village. Over a period of several years, starting in 1969, Giovanni started refurbishing the property. He moved in when he’d finished the renovation. Giovanni tamed the garden. He fenced it, established a vegetable plot and fruit orchard. Giovanni also fenced in some land abutting the property, where he keeps a few goats. Although he has no documents proving his title to the property, throughout the past fifty years, Giovanni has behaved as if owns the property.

Marie Louise is an American citizen who also has an Italian passport. She has presented a claim on the property. She asserts that she inherited the property from her grandfather and that she is therefore the rightful owner.

Is Marie Louise right about her claim? Or, has Giovanni acquired the property through usucapione?

How to organise a legal case based on usucapione:

The first step is to ensure you can evidence your right, specifically to have possessed the property, “uti dominus” (as if you were the owner of the property). Examples could be that you have rented the property, executed building work, etc.

Generally speaking, the role of witnesses is crucial. It is therefore essential to contact individuals who are prepared to give evidence in court.

Obviously, documented evidence is also important (for example, receipts regarding tax payments, invoices concerning building work, etc).

Compulsory mediation

Before starting a court case, it is imperative to apply for a compulsory mediation procedure with a mediation body (Organismo di mediazione) accredited by the Italian Ministry of Foreign Affairs. We recommend that you engage a lawyer to help. The application should indicate the parties involved in the procedure and the property subject to usucapione.

Where the mediation procedure results in a successful outcome, the agreement reached by the parties must authenticated in the presence of a notary public.

In case of a negative outcome from a mediation procedure, it is possible to then start legal proceedings in court.

Taking an usucapione case to court

Back to the above case regarding Marie Louise and Giovanni.

Marie Louise can sue Giovanni in court to reclaim possession and re-establish her full ownership of the property. The success of Marie Louise’s claim will depend on her ability to prove that she acquired the property by valid title and, that the property belonged to her predecessors by valid title prior to her inheriting it. In addition, if Marie Louise can prove that Giovanni’s holding has not been at the property in an uninterrupted manner or that she took proprietary action during Giovanni’s holding and therefore his acquisitive prescription is incomplete, Marie Louise may be able to reclaim possession of the property.

To challenge Marie Louise’s claim, Giovanni should use witnesses to testify that he renovated the house, fenced in the land and has worked the garden in a public, continuous and uninterrupted manner for the past fifty years. In effect he has treated the property as if he were the owner. If during the past fifty years, he has also had access to utilities (e.g., water, electricity) and has paid property taxes, Giovanni should be able to produce receipts to support his usucapione claim.

Finally …

If you own property in Italy, which you have neglected for some time, it is advisable to consult a specialist Italian property attorney to prevent any risks connected with usucapione. You can read more about usucapione or, if you would like to discuss a case, please contact us for a free consultation.

You may also be interested in Usucapione – Safeguard Your Ownership Rights

Legitimate Heirs. Rights of “Forced Heirs” in Italian Inheritance

Italian law provides for legitimate heirs

legitimate heirs in Italian inheritanceAlthough a testator may have expressed wishes in a Will, certain people have a legal right to receive at least a portion of an Italian inheritance. These are all so-called, “legitimate heirs”, or “forced heirs”.

The testator only has one portion of assets to dispose of freely, which varies between a quarter and a half of total assets. This is defined as the, “available quota”.

The remainder of an Italian inheritance is legally designated. This portion goes to a testator’s spouse (or registered partner), children and, in the absence of children, if they are still alive, the testator’s parents.

Legitimate Heirs: what are inheritance quota rights?

If there is only one child, s/he is due at least half of the decedent’s total assets. This becomes a third of assets if the decedent’s spouse or registered partner is still alive. A child would therefore be entitled to inherit a third of the assets.

In the case where there are two or more children, they divide two thirds of the inheritance between them. A surviving spouse or registered partner is entitled to a quarter of the assets, children’s quota decreases to half of the assets. If one or more children pre-decease the testator or renounce an inheritance, their descendants qualify to receive that entitlement.

Where the decedent and surviving spouse or registered partner have no children, the surviving partner is entitled to at least half of the assets.

Parents and other ascendants of the deceased only become legitimate heirs in the absence of descendants. Parents have the right to a third of the inheritance, reduced to a quarter if the decedent’s spouse or registered partner is still alive. The latter is legally entitled to half of the assets.

Regarding property pre-owned by the deceased or owned in common by the spouses or registered partners. The surviving spouse or registered partner has the right to (i) remain in the family house and, (ii) retain all movable assets in the property. In this case, if there are any other co-heirs, there is no requirement to pay property tax on their portion of inheritance. Tax liabilities remain with the spouse or registered partner, even if s/he renounces the inheritance. 

What about the inheritance rights of separated couples?

In cases of a legal separation, the spouse or registered partner loses inheritance rights if a court judgement finds s/he was to blame for the breakdown of the marriage or registered partnership.

Surviving spouses or registered partners who have no court judgement regarding their separation are not legally separated. They therefore have the same inheritance rights as a non-separated spouses and partners. This would also be the case where no assignment of responsibility for the breakdown of the marriage or registered partnership exists.

In other words, the loss of the right to an inheritance relates only to court-issued judgements of separation. The law, in accordance with article 151 of Italian Civil Code, deems a couple to still be in the marriage or registered partnership if their separation was a personal decision and did not go through the courts.

Legitimate heirs and reserved quotas in Italy

Legitimate heirs Reversed quotas and availability
Spouse (or registered partnership) (in the absence of children and parents) 1/2 to the spouse (or registered partner) = 1/2 available quota
One child (in the absence of a spouse or registered partnership) 1/2 to the child = 1/2 available quota
Two or more children (in the absence of a spouse or registered partnership)  2/3 to children (divided into equal parts) = 1/3 available quota
Spouse (or registered partnership) and only one child 1/3 to the spouse (or registered partnership) 1/3 to the child = 1/3 available quota
Spouse (or registered partnership) and two or more children 1/4 to the spouse (or registered partnership)  1/2 to children (divided in equal parts) = 1/4 available quota
Spouse (or registered partnership) and parents (in the absence of children)  1/2 to the spouse (or registered partnership)  1/4 to parents (divided into equal parts) = 1/4 available quota
Parents (in the absence of children and spouse or registered partnership)  1/3 (divided into equal parts) = 2/3 available quota
If there is a Will, the law reserves a quota of inheritance only for the spouse (or registered partner) and children (if the deceased had no children there is a reserved quota for parents who are still living), so if the Will is valid, other relatives cannot make claims.  

 

Finally …

Italian inheritance is a complex matter. In addition, if you own assets in more than one country, this can further compound the complexity. We recommend you seek independent legal advice regarding your personal situation. If we can be of assistance, please get in touch.

For more information about Italian succession and inheritance, you may find our Italian Succession Guide useful.

At De Tullio Law Firm, we have over 55 years of expertise managing cross border succession and estate planning matters throughout Italy. We are a full member of STEP, the world’s leading association for trust and estate practitioners.