Rental Tax on Italian Property

Renting out property in Italy is not difficult to do, but it can be difficult to understand what your obligations then are to the Italian taxman. Below is an overview of the main taxes involved in owning and renting out a property in Italy.
Income tax (IRPEF) – any rental income produced from a property in Italy must be declared in Italy and tax paid on it. You will then need to declare the income again in your domestic tax return, along with the tax paid in Italy. Under the terms of the relevant Double Tax Treaty you will generally receive credit for the tax paid overseas so that you do not pay tax on the same income twice.

The current rates of IRPEF are as follows:

from 0 to 15,000 euro: 23% (first tax band)
from 15,001 to 28,000 euro: 27% on excess of first tax band
from 28,001 to 55,000 euro: 38% on excess of second tax band
from 55,001 to 75,000 euro: 41% on excess of third tax band
from 75,001 euro: 43% on excess of fourth tax band

Obviously these rates are payable on profit, not gross rental income. However the rules on deductibles are much less generous than they are, for example, in the UK.

For advice about paying these taxes you can contact

Studio Del Gaizo Picchioni
Via Marradi 30 – 57126 Livorno (LI)
Telephone: +39 0586 800599
Fax: +39 0586 261363
Email: [email protected]
United Kingdom:
11 Town Furlong, Bodicote, Banbury, OX15 4DP
Telephone: +44 1295 709105
Fax: +44 1295 709105
Email: [email protected]

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