Real Estate Sale and “Prima Casa” Benefits

In the context of real estate purchases with “prima casa” benefits, it is crucial to understand the implications of selling the property within the first 5 years of acquisition. If the property is transferred for consideration or as a gift (donazione), the taxpayer can retain the tax benefits only under one crucial condition: within 1 year of the sale, they must purchase another property specifically intended to become their primary residence (prima casa).

It’s important to highlight that the Italian Supreme Court, in its ruling dated 08/08/2022, No. 24457, clarified a crucial aspect. The ruling overturned a previous stance that denied the existence of a deadline by which the taxpayer had to use the newly acquired property as their primary residence within a year of the transfer of the original property for which they had initially enjoyed tax advantages.

This decision emphasizes the importance of adhering to the timelines and conditions outlined by the law to maintain the tax benefits associated with the purchase of the first home. Timing becomes a critical element in the process of selling and subsequent acquisition, requiring the taxpayer to be aware of the time obligations imposed by the regulations.

This recent ruling of the Court of Cassation underscores the importance of seeking specialized legal advice in real estate matters, especially for international clients.

Get in touch, today.