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agree the price that is acceptable to both parties. Your offer is the
Proposta d'acquisto, you then move onto stage 2
Contratto premliminare (contratto preliminare di compravendita immobiliare
- also known as the compromesso). This works on a promise principle -i.e. the
vendor promises to sell a property to a buyer who in turn promises to buy it.
It is governed
under Italian law so it is a legally binding contract. You have to make sure that
the property is the vendor's to sell and that are no other interested owners.
It is therefore sensible to instruct a good lawyer and if you are not fluent in
Italian, make sure that the translation of the contract is accurate. When you
sign you have to pay 20% of the purchase price plus estate agency commission. Proposta
d'acquisto (offer
to buy subject to contract) You will be expected to make a formal written offer
to purchase the property from the vendor. This is a legally and irrevocably binding
offer (unless you have stipulated otherwise) that means that you are bound by
its terms. When the Vendor (Seller) has accepted your offer, you are both obliged
by law to procced to the compromesso - prelimnary contract. You have to be sure
that all the contractural clauses, dates etc are included in your offer. At this
stage you are then expected to pay a 10% deposit. Once paid the property should
be taken off the market. Compromesso
prelimnary contract - contratto preliminar - commonly called the compromesso.
This is a very important part in the proceedings. The exchange of contracts that
essentially formalises the purchase. This contract binds both parties. It provides
a description of the property and its condition and the details of the sale, agreed
purchase price and date for signing the deed of sale. At this point the vendor
has to warrant that the property is unencumbered by any financial or legal liability.
The purchaser then has to sign the compromesso within 30 days of the Proposta
d'acquisto and
pay a further 20% - 30% of the purchase price. At that time the purchaser will
also have to pay any estate agency fees. Caparra
- Deposit: There are two types of deposit. Caparra Penitenziale - If
the purchasers refuses to perform the contract without a lawful reason after the
Compromesso has been signed, the purchaser will lose the entire deposit. If the
vendor pullout without a lawful reason he / she will have to pay the purchaser
double the deposit paid by the purchaser. Caparra Confermatoria - as
with the first if the purchaser pulls out the entire deposit is lost. If the vendor
pulls out again there is a double deposit amount to pay the purchaser. If there
is a material breach, the claimant can recover damages and can also seek a hearing
to enforce the contract and complete the sale. Rogito
or Atto Notarile - Completion. Within 3 months from exchanging contracts the
purchaser will be expected to complete the transaction by signing the deed of
sale. The date for signing will have been agreed in the compromesso. The final
payment has to be made and the tittle to the property will be transfered from
sellor to purchaser. A Notaio will then witness the final deed of sale and the
conveyance of transfer will be signed. A certified copy of the deed is issued
by the Notaio and the original document is sent to the Ufficio dei registri immobillari
- Land Registry to be registerd. Once this deed has been registered the purchaser
becomes the legal owner of the property. Sometimes several months can elapse before
the registration is concluded. Holiday
rental income
is subject to VAT at 20 per cent. With residential rental income the income tax
is charged at the same rate as other income. The first €100,000 of Italian income
is taxed at 23 per cent with an excess being taxed at 33 per cent. Expenses like
mortgage interest are tax deductible. If
a property is not let out the tax charged is at a notional rate. This would normally
be around 1 per cent of the property's value per year. If the property is sold
within five years of ownership the tax rate will be 23 per cent and if it is owned
for more than five years then there will be no tax. In Italy there is no inheritance
tax, however the beneficiary of the inheritance will have to pay a registration
and transfer tax. N.B.
The above information is given in good faith by jml Property Services and the
website it is being displayed on. It should not be relied on for accuracy and
property owners should consult tax experts / accountants in the country their
property is in and also their home country ©jml property Services 12-05
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