Italy's Revenue Agency clarifies first-home tax benefits

The Italian Revenue Agency (Agenzia delle Entrate) has clarified regulations regarding first-home bonuses and tax credits for property reacquisition. Taxpayers intending to purchase a new primary residence are entitled to first-home benefits and related tax credits even if the property they are selling was originally purchased using only partial tax advantages.

The agency confirmed that subsequent property expansions, if paid for at full tax rates, do not disqualify a taxpayer from receiving benefits for future real estate operations. To qualify for reduced rates—such as a 2% registration tax or 4% VAT for purchases from builders—the property must not be classified as a luxury home (categories A/1, A/8, and A/9). Additionally, the property must be located in the municipality where the buyer resides or works, with a requirement to transfer residency within eighteen months.