Buying property in Italy as a UK citizen – is it hard?

Italy is an enduringly popular location to live, work, study and retire, leading to a large expat population in many areas. If you’re considering a move there – or if you’re intrigued by stories of sales of 1 EUR houses – you’ll need to familiarize yourself with the Italian real estate market.

So – can UK citizens buy property in Italy and are there any post Brexit headaches? The good news is that buying a place in Italy is relatively straightforward. However, it won’t guarantee you a visa or confer residency rights. This guide explores all you need to know and also touches on Wise as a perfect partner for paying for overseas expenses when buying a new home.

Can UK citizens buy property in Italy?

Yes. UK citizens can buy property in Italy with no specific restrictions based on nationality.

This guide walks through how to buy a property in Italy from the UK, including a look at Wise as a great way to pay for your new home with low transfer fees and mid-market exchange rates from GBP to EUR.

How difficult is the process?

Buying a home in Italy isn’t the same as buying a place in the UK. The process can work differently, and you’ll need to navigate the language barrier too.

The UK government recommends that you find an English-speaking lawyer in Italy if you’re buying a home there, who can help you with the process and legal aspects which must be covered. There are helpful government tools to find an appropriate lawyer to guide you.

To get you started, here are a few of the key documents and pieces of information you’ll need to buy a property in Italy:

Codice fiscale (tax code)

You’ll need to have a codice fiscale (tax code) for registering your property and dealing with the government on things like tax payments.

You can get this in Italy in person via the Agenzia delle Entrate (Revenue Agency), or through an embassy closer to your own home if you need to.

Proof of ID and proof of funds

You’ll need to be prepared to show your own ID and if you live in Italy, your residency paperwork. Your notary will also need to see proof of funds which can demonstrate you’re buying the home with legally held money. This might mean showing proof you’re paying from salary, or showing the sale details if you’ve sold a home in the UK to buy your new Italian place for example.

Other important documents

Your notary will work with the seller’s legal representatives to gather and check a series of other important documents, which can include:

• Title deeds to prove legal ownership of the property
• Land Registry Plan (Planimetria catastale) and any relevant Building Permits to show the property has been legally constructed
• Energy Performance Certificate (Attestato di Prestazione Energetica)

Typical timelines

The timeline for buying a home in Italy can vary depending on the property type and the seller’s needs. As with buying a place in the UK, you may find that the end to end process can take two or three months – so plan ahead and be as flexible as possible with your timings.

Transferring money to Italy for the purchase

When you’re planning your property purchase you’ll need to decide how to move your money from GBP to EUR. Choosing a provider like Wise can help you cut costs.

Wise uses the mid-market exchange rate for conversion and transfers, and has low variable fees with automatic discount when sending 20,000 GBP or more over the course of a month. You can use Wise to pay the seller directly when you close on the purchase, or if you’ve already set up an Italian bank account, use Wise to move money between your UK and Italian bank accounts, to get a great rate and a fast payment ready for closing.

What are the tax implications?

Buying a property in Italy – much like buying a new place in the UK – is likely to mean paying some taxes. There are one off costs when you buy a home, but there may also be costs which apply on an ongoing basis.

This guide is for information only. Get professional tax advice to navigate the tax implications of your new Italian home both in Italy and in the UK.

In Italy

When you buy a place in Italy there are several one off costs, which are largely determined by the value of the home:

• Imposta di Registro – equivalent to Stamp Duty in the UK – this is usually 2% of the purchase value for a first home and 9% if you’re buying a second or holiday property in Italy
• Imposta Catastale – Land Registry Tax – this is usually 50 euros if you’re buying a property on the private resale market
• VAT – VAT may apply if you’re buying a property from a company such as a newbuild. Rates vary from 4% to 22% depending on whether it’s your first or second home and how it’s classified

Get advice about the tax you need to pay on purchase, from the notary or solicitor you chose.

There are also some ongoing taxes including IMU (Imposta Municipale Unica)which you may have to pay depending on your residence situation. This tax is decided based on the cadastral value of the home, and varies based on location. You’re also likely to need to pay TARI (Tassa sui Rifiuti) which is a waste tax. This depends on the location and size of the property and the number of people living there.

If you’re renting out your Italian home you may need to pay Italian income taxon the rental income you earn. Rent income is taxed at a progressive rate – get advice to make sure you register your rental income correctly with the tax authorities and pay the appropriate taxes.

In the UK

Bear in mind that there may also be tax to pay in the UK depending on your situation and how you use your Italian property.

For example, if you rent out your Italian place you may need to complete a self assessment for HMRC and pay UK tax on foreign rental income if you’re a UK resident for tax purposes.

There may also be capital gains tax when selling property overseas. UK tax when you sell a foreign property depends on your tax residency.

You’ll normally have to pay some UK capital gains tax on a foreign property if you’re a UK tax resident, and in some cases if you sell your overseas home and then move back to the UK in the next five years. However, there may be tax reliefs available based on double taxation treaties in some cases.

As tax can be complicated, particularly when dealing with the authorities in more than one country, getting professional advice is essential to make sure you fulfil your duties in the UK and in Italy.

Local laws and regional variations

There are no blanket rules which prevent foreigners buying specific property types or locations in Italy. However, you’ll still need to make sure the property has proper planning permissions before you buy – your lawyer can help.

What buying property gets you

Buying a property in Italy might be a great idea if you need a home to live in or as a holiday place for you and your family. Or you may be more interested in treating it as an investment, to rent out or sell in future.

It’s important to note that getting a property in Italy is not in itself a route to residency. You’ll still need an appropriate visa for Italy if you’re hoping to live in your property long term.

What buying property does not get you

Italy is in the Schengen area, which means UK citizens can only visit it alongside other Schengen countries for a total of 90 days in any 180 day period without any other visa in place.

There are a few visas which may suit Brits looking to work in Italy, such as the digital nomad visa or the remote worker visa if you’ll be continuing to work either freelance or remotely during your time in Italy.

If these aren’t the right visas for you there are also options for long stay visas if you’ll be in Italy to study or to be reunited with family there for example. Check out the options through the Italian Embassy and apply for the one which best fits your needs.

Renting out your property: is it allowed?

Renting a property is possible, but you’ll need to register your property with local authorities and ensure any guests staying there are registered with the police. There are also laws on energy efficiency for rented properties which you’d need to abide by.

If you do make rental income in Italy you’ll need to pay Italian income tax. If you’re a UK resident you may then need to get tax advice to ensure you don’t pay tax twice on the same income – double taxation treaties can help here.

Buying land in Italy

UK citizens can buy land in Italy with no specific restrictions. The process works very similarly to buying a property.

Getting a mortgage: should I get one in Italy or the UK?

If you’re planning to finance your property in Italy using a mortgage you’ll be able to look at both UK banks and banks in Italy. As there are a lot of expat home owners in Italy, banks can often provide mortgage services for non-residents, although the deposit needed as a non-resident buyer may be higher than for a resident.

Both options can be attractive, so comparing the offers available based on the value loan needed is important. Remember also that there may be some currency risk involved – for example if you take out a EUR mortgage but earn in GBP, you’ll need to work around currency conversion from GBP – EUR to pay your monthly bills.

Having a low cost currency service like Wise can help you minimize the fees you pay for international transfers, and bring down your bills in the end.

The verdict: should you buy a house in Italy as a UK citizen?

Buying a place in Italy is very attractive as an option for many UK citizens looking for a new place to live, work, study or retire, with a great climate, friendly people and relatively affordable prices.

If you’re thinking about investing in a new place abroad, use Wise to send money from GBP to EUR with low costs and secure, fast payments whenever you need them.

Pros	Cons
✅Great place to live and work ✅Large and established expat communities in many areas ✅Well connected to the UK with frequent cheap flights ✅Cheap homes (from 1 EUR) for renovation ✅Many English speaking agents and legal advisors available to support	❌Property prices may go down as well as up ❌Curency rate fluctuation can mean your mortgage costs more than you expected ❌Taxes on rental income apply

Useful resources

Real estate agents

Find real estate agents by location and need here, or check out these as good places to start your search:

• Italia Casa
• Idealista
• Abode

Main expat areas in Italy

• Rome – Popular for career opportunities in a city which caters well to expat families with international schools and multi-lingual services
• Milan – One of the most diverse regions of Italy with huge expat communities involved in finance and fashion
• Lake Como (Lombardy) – One of several areas popular with retirees, thanks to beautiful scenery and excellent connections to Northern Italy and the rest of Europe