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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?

Italian Property Transaction? Seek Legal Advice

Don’t Leave Your Italian Property Transaction To Chance …

Italian Property Transaction

When buying or selling a property at home, most people wouldn’t dream of doing so without the assistance of a qualified and independent lawyer. Yet in Italy, many buyers and sellers, particularly foreigners, decide not to instruct a lawyer and instead rely on an estate agent to advise them about their Italian property transaction.

Many foreign property buyers find their way to our law practice after encountering serious problems during or after their property transaction. Sadly, some have lost everything.

The reality is that buying an Italian property is an investment. You may not be familiar with the Italian language. Add to this unfamiliar legal, tax and administrative systems and procedures and you are looking at a very complex situation.

Essentially, the need for an experienced, independent lawyer is far greater for your Italian property transaction than when buying property at home.

Italian real estate agents are not qualified to provide legal advice

In many instances, an estate agency will offer to handle all the paperwork for a buyer. With registered and reputable agencies, the intentions are genuine and the conveyancing may well complete satisfactorily. However, estate agents are not trained lawyers. Many have no professional liability or indemnity insurance to cover you in case your property transaction goes wrong or if they miss something crucial.

Real estate agents act on a vendor’s behalf in an Italian property transaction

Also bear in mind that an estate agent is not independent. In fact, they have a potential conflict of interests in offering you advice. Remember that the estate agent is acting for the vendor.

The agent’s primary goal is to sell the property on the seller’s behalf in order to earn their commission. If the sale doesn’t go through because somebody spots an irregularity or a legal problem, the estate agent earns nothing. You, on the other hand, may face a potentially costly and time-consuming ordeal to sort out the issue. You may even expose yourself to prosecution.

Appoint a lawyer in your home country?

As an alternative, some clients look to instruct a lawyer in their home country. However, it is unlikely that the lawyer will have local knowledge of Italy. In addition, it is costly to fly a lawyer to Italy several times in order to conduct searches and checks and to attend completion at a notary’s office.

A lawyer overseas will in all likelihood subcontract the work to a local lawyer in Italy. This may be a lawyer who lacks experience and/ or expertise in cross border and Italian property law.

Because everything needs to go through a number of people, there will inevitably be delays with information and documentation. On top of this, both the foreign and local lawyers will expect to get paid, so in essence, you end up paying twice for the same service.

Finally …

De Tullio Law Firm specialises in Italian and cross border property, inheritance and family legal matters. We are regulated by the Italian Bar Association and a full member of STEP (Society of Trust and Estate Practitioners), the leading worldwide professional body for practitioners in the fields of trusts, estates and related issues.

Our knowledgeable, experienced and multilingual team of professionals manage client cases throughout Italy.

Our clients also benefit from De Tullio Law Firm’s Professional Indemnity Insurance. This is in place should something go wrong during an Italian property transaction due to negligence by our firm. Our clients can however rest assured that in more than 55 years of operations, we have never had to make a claim.

Why leave your property transaction to chance? Get in touch with De Tullio Law Firm. We are here to help make sure your Italian property transaction is a safe and smooth experience.

 

You may also be interested in Buying property in Italy

Italian Estate Tax

Italian estate tax (imposta di successione)

Italian estate taxAlthough the government abolished Italian estate tax in 2001, it subsequently reintroduced it in 2006.

Italian estate tax is therefore applicable to succession cases prior to October 25, 2001 and those from October 3, 2006 onwards.

In order to comply with the fiscal rules of inheritance law, heirs need in the first instance to file a statement of succession with the Italian tax authorities.

Who is liable for Italian estate tax?

If the deceased was resident in Italy at the time of death, Italian Inheritance Tax applies to the deceased’s worldwide assets. However, if the deceased lived outside Italy, Italian estate tax is only payable on assets located in Italy.

Of course, in order to prevent issues with double taxation, Italy has a number of cross border taxation arrangements in place, including with the UK and the USA.

Unity of inheritance

Italian inheritance law is based on the principle of ‘unity of inheritance’. To clarify this, the law of the country of last domicile deals with any movable assets. Movable assets could, for instance be furniture, cars, jewellery, works of art, bank and post office current accounts, money, investments such as shares, bonds, trust and managed funds.

On the other hand, immovable assets are dealt with according to the law of the country wherever they are located. Examples of immovable assets include houses, shops, buildings, agricultural or building land.

How does Italian estate tax work?

While Italian estate tax appears less onerous, in terms of payments, compared to some other EU Member States, it is nevertheless complex.

In effect, Italian estate tax applies to the net value of the deceased’s estate. This therefore, includes not only movable but also immovable assets.

In addition, equity in non-family businesses and shareholdings in companies are taxable. However, there are exceptions to this.

Indeed, because the range of taxable assets is so broad, it is important to review the balance of ownership of your assets in the above mentioned categories. Above all, if you have children or you stand to inherit assets from an Italian estate.

It may moreover, also be worthwhile considering property ownership changes to protect your assets. In addition, some careful estate planning for the transfer of assets within the family is crucial.

Italian estate Tax on property

As far as a property is concerned, it is important to bear in mind the income value of Italian real estate property. This is calculated on the capitalised cadastral annuity.

In order to ascertain the cadastral value of a property, re-evaluation coefficients are as follows.

– Agricultural land: €112,50

– Buildings – Cat. C/1 and E: € 42,84

– Buildings – Cat. A/10 and D: €63,00

– Buildings – Cat. B: €147,00

– Other buildings: €126,00

– Habitable buildings, primary residences and relative appurtenances: €115,50

Depending on the relationship to the deceased and the category of assets, tax is applied proportionally to individual heirs or legatees.

The table below summarises quotas and exemptions from inheritance tax relating to Italian real estate property:

BENEFICIARY INHERITANCE TAX ASSET CATEGORY REGISTRATION TAX CADASTRAL TAX
Spouse and/or Children Value of assets & rights: 4%

Below €1 million value, tax-exempt.

  • Primary Residence
  • Other property
  • Other assets
€200

2%

€ 168

1%

Siblings Value of assets & rights: 6%

Below €1 million value, tax-exempt.

  • Primary Residence
  • Other property
  • Other assets
€200

2%

€ 168

1%

4th Degree Relative Value of assets & rights: 6%
  • Primary Residence
  • Other property
  • Other assets
€200

2%

€ 168

1%

Other Value of assets & rights: 8%

 

  • Primary Residence
  • Other property
  • Other assets
€200

2%

€ 168

1%

Additionally, in accordance with the Italian Disabilities Act, the threshold from which disabled beneficiaries are liable for inheritance tax is €1.5 million.

Furthermore, quotas mentioned in the table above also apply to lifetime use (usufruct) of a property title deed.

What is excluded from Italian inheritance tax?

As previously mentioned, according to Italian inheritance tax law, certain categories of assets are exempt from Italian inheritance tax. These include government bonds and unit linked whole of life insurance policies. Additionally, shareholdings in family businesses and certain charitable donations are exempt.

EU regulations

Choice of law

In addition to Italian inheritance law, it is also worth mentioning EU succession regulations introduced in 2015.  In brief, these regulations provide testators with an opportunity to amend the Italian principle of unity of inheritance.

As a result of EU succession regulations, non-Italians who are resident in Italy can make a choice of law in their will. In other words, a testator can stipulate that they want the law of their own country, or nationality, to govern their Italian-based assets.

Furthermore, EU regulations do not restrict the choice of law to EU nationals resident in Italy. For example, a US national could nominate US law to apply to the succession of their property in Italy.

It should however be mentioned, that nominating a country law needs careful consideration. Given that a testator needs to take in to account matters such as foreign matrimonial regimes, usufruct, tax consequences, joint ownership structures and other foreign proprietary rights with respect to an estate, it would be wise to seek advice before acting.

European Certificate of Succession

In order to facilitate cross border successions, an additional benefit of the EU succession regulations is the European Certificate of Succession. While this document is issued by the relevant authority dealing with the succession, heirs, legatees, executors and administrators of an estate can use it to prove their status and thereby exercise their rights or powers in other EU Member States.

Finally …

As can be seen, Italian inheritance is a complex matter. While there are actions that you can take to mitigate the impact of Italian inheritance tax law on estates, because each case is different, you should seek professional support and advice.

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

Please contact us if you have any estate tax questions or if would like to discuss your situation.

You may also be interested in Inheritance Law and Taxes

Selling Property in Italy. A Short Guide

The Italian sales process and possible issues for vendors

A Short Guide To Selling Property in ItalyWhen selling property in Italy, certain legal issues need serious consideration. Due to differences in legal systems, a real estate transaction in Italy can appear like a difficult and protracted process for foreign investors.

The Italian law is complex. If you don’t fully understand how it works, you may expose yourself to risks. Considering the high stakes involved in a real estate transaction, you should seek legal advice. You should always choose your own lawyer to avoid possible conflicts of interest.

Selling property in Italy is organised in three stages:

  1. Marketing and Reservation offer
  2. Negotiation and signature of the preliminary contract
  3. Completion of the sale

The first stage is to put the property on the market

Vendors can market a property themselves or through an estate agency

If you are considering appointing an Italian real estate agent, it is important to ensure that the agent is qualified and registered with the local Chamber of Commerce. Registration not only guarantees the professional qualification of real estate agents but also ensures they have professional indemnity insurance.

Unregistered estate agencies could be liable to prosecution for carrying out a reserved activity. This carries the risk of fines and other penalties such as not being entitled to commission fees. The agent is in fact, usually paid a commission (Provvigione) both by the buyer and the vendor. Such a commission is negotiable but generally equivalent to 3% of the sale price.

Frequently, real estate agencies require foreign nationals to sign their standard terms of engagement. These need careful evaluation before signing. It is of course key to assess terms and conditions of the brokerage fees. In addition, however, it is important to understand minimum sales price, duration of the mandate and its exclusivity.

Reservation offer

If a potential buyer chooses your property, they would generally sign the first legally binding document called a, “reservation offer”. If you accept the offer, you need to sign off on it and return it to the buyer. In addition, the buyer should pay a small deposit. The reservation offer effectively removes the property from the market for a period of time.

Due diligence

During the period the property is off the market, the buyer should start the legal due diligence process. This means carrying out checks and searches. It should include surveys, planning and local authority (Comune, Building and Land Registry) searches. Checking local planning, zoning and building regulations is also important.

Amongst others, the buyer will want to ascertain the following points prior to moving on to the next stage of the purchase process.

  • The property exists. It is as in the description and, the seller has the legal right to sell the property.
  • There are no mortgages/charges or any third party rights or other undisclosed encumbrances affecting the property.
  • The property complies with all local planning, zoning and building regulations. Or, where relevant, building plans have consent from the Local Authority (Comune).
  • The property is fit for human habitation, unless selling to reconstruct. A certificate to this effect (Certificato di abitabilità) should be available.
  • The seller has complied with all the relevant Italian tax legislation by lodging tax returns and paying income tax (Imposta sui Redditi), which may have been due in the previous tax years. In default of this requirement, the property may legally be unsaleable. If the vendor is a trader or a company, they should not be bankrupt (Fallito), and no application to this effect should be pending against them.
  • Where the property is in an apartment building (Condominio), all service charge payments should be up to date.

The second stage is negotiating and signing a preliminary contract (Compromesso)

When selling property in Italy, the vendor must ensure that all the statements contained in the contract are true to the best of their knowledge. This means full disclosure regarding the property. Any specific enquiries raised by the buyer must be addressed truthfully.

Preliminary contract deposit

Generally, signing a preliminary contract entails the buyer paying a deposit. This can range between 10% and 30% of the sales price of the property. The implication of such a payment is that in the event the purchaser subsequently backs out of the preliminary contract, the purchaser will automatically lose the whole deposit. Should the seller breach the preliminary contract by backing out, they are required to refund the buyer double the amount of the deposit. In addition, further sums may be payable, if there is proof that damages exceed the amount of the deposit.

Italian law states that both parties to a prospective transaction must act in good faith

Prior to signing a preliminary contract, the seller must provide the buyer, or their legal advisers, with copies of all documentation relating to the property. In addition, the seller must inform them of any material fact which may affect the decision of the buyer to proceed with the purchase of the property.

It is important to ensure that the property complies with all applicable planning and building regulations. Any breach of this legislation may result in the rescission of the purchase contract and heavy penalties. Where the seller has applied for a planning amnesty (Condono Edilizio), the prospective buyer should receive copies of the relevant documentation.

Certificate of habitability

Note that before or at the latest upon completion,  the seller must produce the property’s certificate of habitability (Certificato di abitabilità). The local municipality is responsible for issuing a certificate. It confirms compliance of all the systems installed in the property with Italian law and in respect of the relevant health and safety regulations. This certificate is mandatory. It goes without saying that it is, therefore, advisable for the seller to obtain this certificate prior to signing a preliminary contract and payment of the relevant deposit. Otherwise, the seller may run the risk that the transaction falls through. This would put the seller in a position of breach of contract.

To avoid possible claims and penalties, should a certificate of habitability not be available on exchange of contracts, the seller should disclose the issue prior to signing a preliminary contract and the contract should state either that the buyer is renouncing receipt of the certificate of habitability or alternatively that completion of the purchase is conditional on the seller obtaining this certificate.

Mortgages

If the property is subject to a mortgage, the seller has a duty to redeem the same and cancel the corresponding entry on the Local Land Registry before completion of the sale.  If the buyer is purchasing the property using a mortgage, it is advisable to finalise all the arrangements before signing a preliminary contract. However, this process may become expensive and protracted for the prospective buyer.

Pre-emption rights when selling property in Italy

Particular care should be taken if the sale is a villa or land with statutory farming pre-emption rights (Prelazione agraria) by owners or tenants or immediate neighbours in agricultural areas in Italy. According to Italian law, farmers, tenants and neighbours are entitled to be notified of a proposed sale of a property to third parties. They have first option on buying agricultural land in their immediate neighbourhood. Therefore, immediately before, or if this isn’t possible, after signing the preliminary contract, it will be necessary for the seller to serve a copy of the contract on all parties having pre-emption rights, so that any person with an interest can declare within the statutory term (usually 30 days).

It is important to ensure full compliance with this legislation. A breach of statutory farming pre-emption rights may result in a claim on the property. Anyone making a claim can do so up to a year after the sale. This in turn, would give the buyer a legal claim against the seller.

Breaches can have serious consequences

Essentially, at this stage, the seller should disclose any breaches pertaing to the property as well as proof of remedial action.  This includes any missed tax payments and outstanding breaches or notices from relevant authorities.

These are just some of the points to take into consideration, but there are many others. All have potentially serious consequences for the vendor. It is therefore important that the vendor acts in good faith. A claim for damages based on misrepresentation is just one of the consequences that the seller should aim to avoid.

Selling property in Italy. The third stage: completing the sale

This usually takes place in the offices of a notary (Notaio). In Italy, vendors and purchasers often use the same notary, but you are perfectly within your rights to have your own notary.

A notary must oversee completion of Italian property transactions

Italian Notaries are officials entrusted by the law to transfer the legal title of an Italian real estate. They have a duty to correctly draft the Deed of Sale (Rogito), to ensure its proper execution and registration. In addition, on behalf of the Italian State, they collect payment of all Italian taxes ancillary to the completion.

While notaries are qualified lawyers, Italian law prohibits them from acting on behalf of any of the parties involved in a transaction. They must remain impartial. Only your own lawyer may offer legal advice to protect your interests.

Before completion the vendor should provide the Title Deeds. This could be the Purchase Deed, or the Italian Inheritance Tax Return lodged with the tax authorities. The vendor will also need to produce all the relevant documentation pertaining to the property. This includes for example, planning and building licenses. And, if the sale is of a building, rather than land, an Energy Performance Certificate and a certificate of Habitability.

All parties have a legal duty to provide the notary with information regarding the sale price and the appointed estate agency. This information will appear in the Deed of Sale, in the form of a solemn affirmation under oath (Dichiarazione sostitutiva di atto di notorietà). If this information is missing, incorrect or incomplete, the parties risk a harsher form of taxation on the sale of the property, plus substantial fines.

Fiscal matters

If the vendor benefits from “prima casa” (first home) fiscal reductions, there will be a penalty to pay if resale takes place within five years of the original purchase. The seller can however avoid penalties if they buy a new residential property in Italy within one year of the sale.

Following completion, the seller may be subject to Italian capital gains tax. However, no tax is usually levied if the vendor has owned the property for more than five years.

Finally …

As a general rule, it is wise to familiarise yourself with the legal framework regulating international property sales. If you are thinking of selling property in Italy and would like more detailed information, you might like to read the full version of our Selling Italian Property Guide.

For over 55 years, De Tullio Law Firm has been providing international clients with independent legal advice throughout Italy. We are specialists in cross border property, inheritance and family law.

If you are in need assistance selling property in Italy, we are here to help. We can guide you through the whole process or even organise the whole process on your behalf. Get in touch with us for a free preliminary consultation.

 

 

 

Buying An Italian Property. A Short Guide

This short guide aims to cover the key elements of the Italian purchasing process

For a more in-depth explanation, you may wish to read our comprehensive Italian Property Buying Guide.

Italian Property Buying GuideBuying an Italian property proceeds through 3 key stages:

– Proposta irrevocabile d’acquisto (Reservation offer)

– Contratto preliminare di vendita (Preliminary contract)

– Atto di vendita (Deed of sale)

Once you have chosen your property you should engage the services of a solicitor, whether you buy through a real estate agent or directly from the vendor.

The knowledge that an Italian solicitor has about Italian real estate law is invaluable – plus, your own solicitor is there exclusively to look after your interests.

The first stage. Reservation offer

When buying an Italian property, the first document you will have to sign is a, “proposta irrevocabile d’acquisto” (reservation offer). This is normal practice when purchasing through an estate agent

In contrast, when purchasing directly from the seller (a private sale) a reservation offer is unusual. The implications of dispensing with a reservation offer is one of the many reasons why you should seek legal advice.

By signing the proposta irrevocabile d’acquisto, you secure the removal of the property from the market for a limited period of time, normally 15 days.

It is important to highlight that a reservation offer is only binding upon the buyer when formal written acceptance of the offer has been received from the vendor. Once the agreement has been signed by both parties, it becomes a legally binding contract.

First deposit

You will need to pay a small deposit, which is normally held by the estate agent or solicitor until the vendor has formally accepted the reservation offer.

Should you finalise the purchase, this deposit becomes a part payment of the purchase price. If the seller does not formally accept the offer, your deposit will be refunded.

Due diligence

While the property is off the market, your solicitor, assisted by a surveyor, will make all the necessary searches to ascertain that the property doesn’t have any debts, mortgages, claims etc. Due diligence checks and searches ensure there will be no unpleasant and possibly costly surprises during or after the purchase.

The second stage of buying an Italian property. Preliminary contract

Normally at this stage, buyer and seller having agreed to go ahead with the conveyance, will formalise their agreement through a “contratto preliminare di vendita” (preliminary contract)

Some estate agents (and especially in the case of private sales) choose, or recommend, leaving out this part of the purchase process. However, this legal document really is essential. It sets out the detailed terms and conditions of the sale.

Estate agents often use boilerplate preliminary contract templates. These may not be suitable for your personal situation. Your purchase may be subject to certain terms and conditions. For example, you may have come across some structural issues during due diligence and want to make your purchase contingent on a surveyor’s report. This condition would need to be in the preliminary contract. A solicitor can draft the contract, or at least to examine the estate agent’s template and advise you on any implications before you sign it.

Second deposit

One of the essential legal elements of the preliminary contract is the payment of a deposit (caparra confirmatoria). This is normally equivalent to a minimum of 10% of the purchase price.

If you back out of the contract without a valid legal reason, you will lose this deposit. On the other hand, if the seller changes their mind about the sale, they will have to refund your deposit in full. You would also have the right to claim an amount equal to the deposit through the Italian courts.

In the preliminary contract, the parties also set the date to finalise the conveyance in front of the public notary.

The third Stage of buying an Italian property. Completion of the sale

By law a notary must oversee Italian property transactions. The notary is a public official who has State authority to validate contracts transferring the ownership of a property. The notary is also responsible for paying all land registry fees and cadastral taxes.

A notary must remain absolutely impartial

A notary may not therefore offer legal advice to any party involved in a property transaction. The notary cannot therefore act as a substitute for a solicitor in terms of representing the interests of the buyer.

In order to ensure you have proper legal safeguards, the only way is to engage the services of an independent solicitor. Only by having your own solicitor, can you be confident that no unpleasant surprises will be revealed at this late stage of the purchase process.

Deed of sale

Buying an Italian property concludes with the, “atto di vendita” (deed of sale).

The deed of sale is drafted by the notary and has to be fully compliant with the preliminary contract. In other words, the preliminary contract dictates all the essential elements of the transaction.

Translation

Should any of the parties not understand the Italian language, Italian law requires a translation of the deed of sale. Unless you have an Italian solicitor who speaks your language, the notary may also require that a qualified translator be present at the signing.

Unlike a translator, the advantage of having a solicitor with you is that should any last-minute legal issues arise at the signing, your solicitor will be able to immediately resolve these.

You should be aware that the Italian version of the deed will prevail in a court of law if any issues arise at a later stage.

Signing day

On the appointed signing day, all parties to the transaction convene, usually at the notary’s office. The notary reads the deed aloud and all parties then sign it in front of the notary. Once signed, the buyer pays the balance of the purchase price to the seller and the new owner receives the keys of the property.

New owners can collect a copy of the deed from the notary approximately one month after the signing. It takes approximately one month to register the deed at the relevant land registry office.

If the buyer cannot be present to sign the deed of sale in front of the notary, the buyer can give a power of attorney to their solicitor. This will permit the solicitor to sign the deed of sale on the buyer’s behalf.

Finally …

As a general rule, it is wise to familiarise yourself with the legal framework regulating international property sales.

For over 55 years, De Tullio Law Firm has been providing international clients with independent legal advice throughout Italy. We are specialists in cross border property, inheritance and family law.

If you would like further information about buying an Italian property, we are here to help. We can guide you through the whole process or even organise the whole process on your behalf. Get in touch with us for a free preliminary consultation.

Buying an Italian property. Glossary
  • Proposta irrevocabile di vendita: An initial formal offer with a small deposit. It contains the price you are willing to offer and any conditions.
  • Contratto preliminare di vendita: This contract sets out, in detail, the terms and conditions of the sale and also all the relevant cadastral and land registry information. Also called a, “Compromesso”.
  • Caparra confirmatoria: Italian Civil Code regulates this deposit under art.1385 of the. If a deposit is defined as a “caparra confirmatoria” its payment gives rise to legal rights and obligations on both parties.
  • Atto di Vendita: All parties sign the deed of sale in front of a public notary. The buyer makes outstanding balance of payment and receives the keys to the property. Also called a, “Rogito”.

Italian Inheritance Law Services

Italian Inheritance law: De Tullio Law Firm's servicesItalian Succession 

For over 55 years, De Tullio Law Firm​ has been providing clients worldwide with clear-sighted Italian inheritance law services.

Roman law

As Italian succession law is based on the principles of Roman Law, it provides some protection to close members of the family. This therefore partially limits the right of the testator to dispose of his/her own assets.

Testamentary Succession is defined as the assignment of hereditary assets in compliance with the wishes of the testator as set out in an Italian Will. Whereas, in the absence of a Will, inheritance is devolved following the principles of Legal Succession. In other words, where there is no will, succession law gives rights to a number of legitimate heirs. This means that certain heirs have the legal right to inherit a portion of the deceased’s estate.

Known as legitimate, reserved or forced heirs, these beneficiaries are the spouse or registered partner of the deceased. Thereafter, beneficiaries include relatives identified by law as those closest to the deceased. For instance, children, parents and relatives up to the 6th degree of connection.

Italian succession law reserves a significant quota of inheritance for these beneficiaries. Because they are defined as forced heirs, it means that a testator cannot exclude them from inheriting, even with a Will.

However, when drafting an Italian will, the testator is free to dispose of a part of his assets known as the, “disposable quota”. This allows the testator to assign part of their assets to non‐relatives or organisations such as charities.

Our Italian inheritance law services

– Italian inheritance rights assessment

– Drafting Italian Wills

– Claiming / recovering inherited Italian property

– Italian property, titles, records searches

– Legal support for the sale of inherited Italian properties

– Obtaining appraisal and or a survey of inherited Italian property

– Determining Italian inheritance tax

– Obtaining copies of public Wills

– Challenging Wills drafted in conflict with the Italian legislation

– Managing Italian probate

– Registering inherited property in the name of heirs

– Obtaining release of inherited funds deposited in Italian banks

Read more about our Inheritance Services.

Finally …

If the deceased was resident in Italy at the time of death, Italian Inheritance Tax applies to the deceased’s worldwide assets. However, if the deceased lived outside Italy, Italian estate tax is only payable on assets located in Italy.

If you own assets in Italy, we recommend that you draft an Italian Will. And, if you need help with Italian estate planning, we can support you.

At De Tullio Law Firm, we have over 55 years of expertise with managing cross border succession and estate planning matters throughout Italy. We offer a full range of Italian inheritance law services. In addition, our firm is also a full member of STEP, the world’s leading association for trust and estate practitioners.

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

If we can be of assistance, please get in touch at: info@detulliolawfirm.com

 

You may also be interested in our inheritance videos.

 

Holding Accounts in Italy. Property Completion funds

Keep your money safe

Keep Your Money Safe in Italy: Notarial Holding Accounts for Your Italian Property Purchase On 29th August 2017, Italian legislation saw the introduction of holding accounts. The legislation governing payment for the purchase of Italian residential and commercial real estate is part of the Italian Law of Competition.

The law aims to provide better protection to both property buyers and sellers.

Holding accounts are applicable to funds for the completion of the purchase of Italian property. Deposits connected with a reservation offer and preliminary contracts are not subject to this legislation.

The buyer and/ vendor must request their chosen notary to use a holding account. In other words the notary doesn’t automatically use holding accounts.

In addition, the buyer can request the notary to keep funds in a bonded account. Again, the onus is on the buyer to specifically request that the notary use bonded holding accounts. As this may generate problems with the seller, we would recommend that the preliminary contract include a clause that all parties authorise the notary to hold completion funds in bonded holding accounts.

How do holding accounts work?

The buyer acquires legal ownership of the property at the signing of the deed of sale. However, by using a holding account, the notary will delay payment until after registration of the deed.

Following signature by all parties to the transaction, the notary has 30 days to register the deed of sale with the relevant land registry authorities.

Once registration of the deed takes place, the buyer can be certain that the purchase has been completed smoothly. Tranfer of funds to the vendor can then take place.

Keeping funds in holding accounts therefore provides protection to the buyer between signing the deed of sale and its registration.

Between signing and registering the deed, adverse entries pertaining to the property can come to light. Issues might include outstanding debts, mortgages, encumbrances, court applications for seizures and foreclosures.

The Law of Competition states that when purchasing property, all outstanding payments by the buyer to the seller should be kept in dedicated holding accounts belonging to a notary. This sum also includes any amounts the vendor may require to settle liabilities. For instance, the vendor may still be paying off a mortgage on the property. In this case, the buyer would pay the entire balance of payment for the property into the notary’s holding account. However, a part of this will serve to redeem and cancel the vendor’s mortgage lender once the purchase is complete.

Can all notaries hold money?

The Law of Competition stipulates that a notary must have holding accounts in which the notary can receive funds from clients for the delayed payment of real estate property.

A notary has no entitlement to any interest accruing to these holding accounts. Nor can a notary use funds for any other purpose than the payment of a particular property.

Furthermore, if a notary has debts, creditors can not foreclose on money deposited in holding accounts. Should the notary die, any funds in holding accounts do not constitute part of the notary’s estate. And in the event of death, funds do not form part of the notary’s matrimonial property regime.

Finally …

If you are looking for further information about the Italian property purchasing process, you might find our comprehensive guide helpful, or if you need independent legal advice,  please get in touch for a free consultation.

 

You may also find Buying Property in Italy useful.

Reserved Acceptance – Italian Inheritance

Debts on an Italian inheritance

Accepting an Italian inheritance also implies taking on responsibility for any debts the decedent leaves. Heirs risk having to paying any debts they inherit from their own pockets. For this reason, Italian law confers a choice of whether to renounce or accept an inheritance. There is however, also a third way to mitigate risks: reserved acceptance. To illustrate the concept of reserved acceptance, below we provide a brief case study on this matter.

Silvia and Eric Jones owned a property in Liguria and were resident in Italy for many years. Sadly, in close succession, Silvia and Eric died.

The Jones’ sons, Larry and Tom, got in touch with De Tullio Law Firm about their parents’ Italian Wills. They had concerns regarding what happens when heirs are unsure exactly what they are inheriting. Larry and Tom believed that their parents had a lot of debts. They worry they will have to pay these debts if they accept the inheritance.

Because heirs have the possibility to accept an inheritance using reserved acceptance – “beneficio d’inventario”, it means that Larry and Tom will only be liable to pay their parents’ debts on any sum they inherit.

What is reserved acceptance?

If you are an heir, but you are unsure whether the inheritance contains more liabilities than assets, you can use, “beneficio d’inventario” (reserved acceptance). This avoids any merger between your estate and the decedent’s. Thus you will not be liable to pay off the decedent’s debts with your own money.

If, for example, you inherit €10,000, compared to a debt of €20,000, you will only be liable to pay the debt on the sum you have inherited, namely the €10,000.

Reserved acceptance is however not a good idea if an heir is certain that liabilities outweigh inherited assets (unless the heir wishes to pay debts in order to honour the decedent’s memory). Where certainty of debt exists, renouncing the inheritance is a more appropriate solution.

It is worth mentioning that certain people have to accept an inheritance through “beneficio d’inventario”. These people include minors under the age of eighteen, people in care and legal entities, including the State, associations and foundations.

How does reserved acceptance work?

You need a notarial deed for reserved acceptance. Alternatively, you can make a declaration to a clerk of the court in the district where the decdent had their last domicile.

Finally …

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

If you are unsure about any aspect of an Italian inheritance, please contact us. We will be happy to provide you with more detailed information.

Inheritance Law in Italy

Italian Inheritance Law – An Overview

Property Inheritance Laws in ItalyInheritance law in Italy follows the Roman Law principle. This means it provides some protection to close members of the family. This therefore, partially limits the right of the testator to dispose of assets.

Testamentary Succession consists of the assignment of hereditary assets in compliance with the wishes of the testator as set out in an Italian Will. In the absence of a Will, inheritance devolves following the principles of Legal Succession.

The rights of heirs in Italian inheritance law

Where there is no Will, succession law gives rights to a number of legitimate heirs to the assets of the deceased. These heirs are the spouse of the deceased and relatives that the law identifies as starting from closest kin to those up to a 6th degree of connection.

Inheritance law in Italy reserves a significant quota of an inheritance to very close relatives. The deceased’s spouse, registered partner, ascendants and descendants are all known as, “forced heirs”. This means that the testator cannot exclude them even if there is a Will. When drafting an Italian will, the testator is only able to dispose of a part of his assets. The testator can assign this, “disposable quota” to non-relatives.

The basis of Italian inheritance law is unity of inheritance. This distinguishes between moveable and non-moveable assets.

To clarify, the law of the country of last domicile deals with any movable assets. Movable assets could, for instance be furniture, cars, jewellery, works of art, bank and post office current accounts, money, investments such as shares, bonds, trust and managed funds.

On the other hand, the law of the country where an immovable asset is located applies. Examples of immovable assets include houses, shops, buildings, agricultural or building land.

Therefore, the law of the country where a property is located will apply, unless in accordance with EU Regulations, a choice of country law is stipulated in a will.

The Italian succession procedure formally ends when all assets, rights and pending payments have been transferred to the rightful heirs either by mutual agreement or as consequence of judicial proceedings.

Finally …

For more in depth information about Italian succession, you might find our Succession Guide useful. If you would like to discuss a case, you can reach us here for a free consultation.

Cross border inheritance in Italy

Italian inheritance law

Cross border inheritance in ItalyMany of our clients own property at home and here in Italy. We frequently receive questions about how cross border inheritance in Italy works.

Law no. 218 of 31st May, 1995 regulates the field of Italian inheritance law in the framework of international private law.

Habitual residence of the deceased at the time of death determines the national law which governs succession.

Italian Inheritance legislation adopts the principle of “unity of inheritance”. This principle differs substantially compared to legislation in common law countries. Italian law makes a distinction between a division of movable and immovable assets. Movable assets are subject to the law of the last domicile or last residence of the decedent. Immovable assets are subject to “lex rei sitae” (law of the country where property is located).

One of the most important consequences of asset divisions is that, if a decedent’s estate includes properties located in different countries, the succession of each individual property could be regulated by the law of the country where the property is located.

Cross border deferment to the law of another country

Italian rules governing conflicts of law consider the possibility that the national law of a deceased foreigner might defer to the law of another country.

Here is a practical example. A deceased English national resident in England owned property in Italy. The law of England and Wales therefore governs succession. However, in accordance with the conflict of law of England and Wales, the law applicable to properties abroad is, “lex rei sitae (law of the country where the property is located). This means, Italian succession law governs the assets in Italy.

In 2015, the EU introduced regulations whereby a testator can elect which country law should regulate all assets. This could be the law of the country in which the testator is habitually resident or the country of the testator’s nationality. This choice of law has to be formally expressed in a Will. In addition, it must not prejudice the rights that the Italian law provides for forced heirs, “legittimari”. These are members of family, resident in Italy when the testator dies. Although it may be against the testator’s wishes, forced heirs must receive a legally determined share of the estate.

An Italian will is the best option to manage cross border inheritance in Italy

If you own assets at home as well as in Italy, it is highly advisable to draft an Italian Will for your Italian assets. In order to limit the consequences of “legal succession”, you should seek legal advice in this matter.  If a decedent died intestate, that is without a Will, Italian Inheritance law determines which relatives of the deceased have a right to inherit an estate. This will primarily be the spouse, the legitimate and natural children, and any ascendants. Where no heirs are traceable, Italian assets go to the Italian State.

Finally …

If you would like more details about Italian succession law and procedures, we have produced a comprehensive Italian Inheritance Guide, which we hope you will find helpful. If you would like to discuss a specific case, we are here to help.