Monday, April 19

A Guide to Claiming Italy’s Key Construction Bonuses in 2021


Homeowners in Italy can benefit from a variety of building bonuses on offer, which have been extended throughout 2021.

There is even more financial help you could get in addition to the widely reported Superbonus scheme, It offers a tax refund of up to 110 percent of expenses incurred for certain property restorations.

The Relaunch Decree (Relaunch Decree), introduced in 2020 in response to the Covid-19 emergency, saw an increase in the state kitty for so-called ‘Ecobonus’ and ‘Sismabonus’ restoration bonds.

Given that almost three-quarters of homes in Italy are over 50 years old, according to the Revenue agency (Italian Revenue Agency), there is a constant demand to revitalize many abandoned properties.

But there is more I could claim this year, along with the two previous schemes.

In addition to the financial package available to make energy improvements and reduce seismic risk, there is also a government pot for furniture, refreshing gardens and optimization of water consumption.

READ ALSO: Which areas of Italy have the highest risk of earthquakes?

Can anyone who owns a property in Italy claim these bonds?

Unlike the ‘Ecobonus’ and the ‘Sismabonus’, most of these bonds are for people who pay taxes in Italy, as they are mainly tax deductible schemes.

So you can offset your income taxes if you decide to dip into these government-owned pots. However, not all are tax deductible and some bonuses are available to both Italian residents and non-residents.

Here’s a breakdown of the other major building bonuses, besides the Superbonus scheme, that you might qualify for.

Note: These are complex and subject to change, so it is important to obtain professional advice before purchasing and renovating.

READ ALSO: How to avoid problems when renovating your Italian property

There are different government bonuses that you can claim to renovate a property. Photo: Henry & Co / Unsplash

The renewal bonus

The Restructuring bond was included in the government Budget Law 2021 (Budget Law 2021) once again. Continuing through 2021, you can request a 50 percent tax cut on renovation work on both individual and condo properties.

You must be an Italian resident who pays income tax, known as ‘IRPEF’, to access this voucher.

There is a maximum spending limit of € 96,000 and the 50% tax compensation is divided into annual installments for 10 years. That means you can deduct € 48,000 over 10 years with this scheme.

There are a large number of allowances to access this bonus. These include making repairs to damaged property, building garages or parking spaces, increasing property security such as installing gates, security gates and CCTV, removing asbestos and gas detection equipment.

READ ALSO: Italy’s house prices rise at the fastest pace in a decade

This scheme is available to taxpayers in Italy, both resident and non-resident. Not only the property owner can claim the 50 percent tax deduction, but also tenants, members of cooperatives, and people who earn income from partnerships and family businesses.

Condominiums can also take advantage of the bonus for work in common areas.

In a move to increase the transparency of fiscal leads, the government included payment instructions in the Budget Law. Payment for renewal services must be recorded by bank or postal transfers.

More details about this bonus can be found. here.

You could access government funds to fix your garden. Photo: Elija Hail / Unsplash

The green bond

The Green bond it was also expanded in the government’s Budget Law and is available until the end of the year.

You can get help from the state to design your garden or private outdoor areas on an existing property, supply plants and shrubs, do fence work, irrigation systems, build wells, roofs, or roof gardens.

There is a 36 percent tax deduction available for work related to landscaping, decking, and general green space. Like the renewal bond, you must be a contributor to benefit from it.

The tax relief applied in the tax return must be divided into 10 annual installments of equal amounts and must not exceed a maximum expense equal to € 5,000 for each property.

In other words, the maximum deduction you can claim is € 1,800, which is equivalent to 36 percent of the € 5,000.

READ ALSO: How and where to find your dream renovation property in Italy

The voucher cannot be used for shops or offices, but if a residential property is also used for work, you can claim half of the total tax relief available.

People who live in condominiums are also eligible to apply for work done in common areas.

However, you can’t get a cash boost for general yard maintenance. Routine maintenance, the purchase of garden tools and any non-innovative work are excluded from the expenses; that means transforming a green area rather than just keeping it well pruned.

Second home owners can also claim for this as the bonus is available per property, not per owner.

More details about the green bond can be found. here.

READ ALSO: Italy Building Bonus: Can You Really Claim the Cost of Renovating Property?

The furniture and appliances voucher

Believe it or not, there is even some state aid available to buy home appliances: the Furniture and appliances bonus. You can claim a 50 percent tax deduction on expenses up to a maximum of € 16,000, as detailed in the Italian Tax Agency report. updated guide.

The 2021 Budget Law boosted the funds from last year’s € 10,000 limit. This scheme applies to household items of at least class A + (A for ovens), intended to furnish a property under renovation.

That means this bonus is linked to the renewal bonus. To be sure you can access this, renovation work must have started before purchasing furniture or appliances, but property restoration costs do not need to be paid in advance.

Some elements covered by the bond are the following:

  • Ovens
  • Refrigerators
  • Dishwasher
  • Electric hobs
  • Washer-dryers
  • Washing machines

You qualify for this if the items you buy are for residential property and, like the two previous bonuses mentioned above, the deductions must be spread over 10 annual installments. You must make any purchase before December 31, 2021 to qualify for the € 16,000 maximum spending limit.

READ ALSO: How will Italy’s real estate market change in 2021?

The facade bonus

Another bonus extended in this year’s Budget Law is the Bonus Facades. This scheme allows you to deduct 90 percent of the amount incurred to renovate the exterior facades of buildings, without maximum spending limits.

Everyone can benefit from this bonus. Again, those who pay income tax can access it, as well as those who have a Value added number (CIF) and even tenants of rented properties. Both Italian residents and non-residents are eligible.

The facade voucher is available throughout 2021 and covers a large amount of work, including restoring external surfaces of existing buildings, balconies and friezes.

You can deduct 90 percent of the expenses of the gross tax of the personal income tax, ‘IRPEF’ or of the corporate tax, known as Corporate tax (IRES).

You can get more information about this bonus here.

The Water Bonus aims to increase water efficiency. Photo: Jos Speetjens / Unsplash

The water voucher

The Water voucher It was also expanded in the Budget Law and provides for a 50 percent discount on € 1,000 in works for individuals residing in Italy and up to € 5,000 for companies.

To claim from this national portfolio, you will need to purchase water-saving products such as water-saving toilets, showers, taps, and sinks. It is a government commitment to promote less water consumption.

The money is for the supply and installation of ceramic sanitary toilets and related drainage systems, including plumbing and masonry work and the dismantling of pre-existing systems.

The way to access the bonus has yet to be defined by a decree from the Ministry of the Environment and Protection of the Land and the Sea. For the latest on this bonus, stay tuned to this site.

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Next steps

To check if you are eligible, speak to a professional and keep checking Revenue agency website before beginning any work on the property.

If you are interested in buying, you can also refer to our guide to the additional costs you may not expectand read about some of the common mistakes to avoid when buying a house in Italy.

See more in The Local’s Italian property section.


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