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Private apartment lessors note – new regulations applied as of June 2017

12 May 2017

Thanks to agency portals like AirBnb and Homeaway, it is nowadays easy as it has never been before, to make money out of renting your property as a holiday home. Also on Lake Garda a lot of holiday homes are rented out as private rentals and register more and more overnight stays every year.

As a matter of fact, also in Italy, the profit earned by such lettings (rental period of a maximum of 30 days) is subject to income tax, which has to be filed as a personal income tax return or withholding tax. At least in theory. In practice this does not always happen. Spot checks of the Italian tax authorities show that income tax has been only paid for about 25 % of all private lettings!

On April 24th 2017 a new tax law entered into force, wanting to fight unregistered lettings: As of June 1st 2017 all intermediaries, like angencies and online-sites, have to automatically pay a tax of 21 % of the rental fee, directly to the tax authorities on behalf of the property owner.

It won’t be possible to completeley prevent unregistered lettings by taking these measures, because a lot of houses are rented out through personal contacts.

The intent behind the operation seems to be another: The state of Italy obligates big online portals, which pay their taxes abroad, to pay a settelment tax in Italy. By having to do that, it it easy for Italian authorities to understand and calculate their actual sales volume in Italy.

The new duties of the intermediation agencies at a glance

  • As of June 1st 2017, intermediation agencies and online portals have to report any conclusion of a contract directly to the tax authorities within a period, which has to still be settled.
  • Subsequently they have to withold 21 % of the rental fee and pay it directly to the tax authorities using the form “Modello F24”. If the property owner decides to pay a settlement tax, no other taxes have to be paid. If he decides for the crediting of the income tax, the already paid amounts are put on credit for whatever he owes.
  • All intermediaries have to submit the accomodation providers a written confirmation of the amounts paid.

Penalties for unpaid or too late paid taxes range from 250 to 2.000 euros. Property owners, who use these venues to sublet their properties, have to make sure that their intermediary agencies or websites fulfill their obligations – on time!

Further news regarding italian legislation