Here are examples of some of the main taxes that will affect you if you decide to buy property, and/or relocate to Italy.

Income tax (Imposta sul Reddito delle Persone Fisiche (IRPEF).

If you are a foreigner working in Italy for an Italian based company or employer, and you are resident in Italy with no income tax liability abroad, your domicilio fiscal (fiscal residence) will be considered to be Italy.

If any of the following criteria apply to you, then you will almost certainly be considered liable for income taxation in Italy:

- Your principal residence (home) is in Italy.

- You have applied for and been granted residenza by your local comune.

- You spend over 183 days per calendar year in the country.

- You are employed by a company based in Italy, or carrying out self-employed business activities primarily in Italy.

- Your primary investments or business is in Italy.

Unless your primary income is coming from a professional activity undertaken in Italy, and for an Italian company, it may well be advisable to continue paying your income tax in the UK. A reciprocal agreement that is in place between the two countries will ensure that you are at no time required to pay income tax in both countries, and the high rate of income tax in Italy would make it a more financially interesting possibility for you.

But if your intention is to relocate (both yourself and your professional activities) permanently to Italy, then you should request the appropriate form to notify the UK tax authorities of your departure (an absence of a minimum of 18 months is required in order to entitle you to a possible tax rebate from the UK). Actual proof that you’re leaving the country may well be requested; a job offer or contract in Italy, or proof that you have rented or purchased a property there.

You will be considered income tax exempt if the following criteria apply:

- You do not carry out any professional or business activity.

- You have not received any income.

- You have only received income already taxed or that is tax exempt.

ICI (Imposta Comunale sugli Immobili)

This is a tax, similar to the UK council tax, which until 2009, was levied on all properties. The law has now changed, and property owners will only be charged for second properties – whether their primary residence is in Italy or elsewhere. If you are a non-resident, it will automatically be assumed to be a second property regardless of whether or not you actually own a property elsewhere.

This tax is tied to the calendar year, thus covering the property from the 1st of January to the 31st of December of the year in which the tax is paid. ICI is paid in two instalments, the first in the month of June, the second in the months of December.

Purchase Tax (Imposta Ipotecaria e Catastale)

This tax is payable on all resale properties in Italy – new build properties are subject to VAT (IVA) of 9 per cent for a non-luxury property, and 19 per cent for a luxury property. Purchase Tax is paid at the moment of signing the rogito (final sales deed) and is collected for the Italian government by the notaio. Italian residents will pay a purchase tax of 3 per cent, non-residents will, however, be subject to an elevated charge of 10 per cent.