An international buyer purchasing a €5 million villa on Lake Como faces a decision that logically precedes the purchase itself: in whose name should a property in Italy be registered?
This is a question that's almost never asked in the mainstream market. In the premium segment, it's crucial, because the ownership structure determines current tax treatment, future transfer terms, inheritance exposure, and the transaction's level of confidentiality.
And, this is the point, the structure is chosen before the deed. Changing it afterward requires a new deed, new transfer taxes, and in some cases significant tax consequences.
Option 1. Registering a property in Italy in the name of a natural person
Registering the company in the name of a natural person is the simplest and most common solution.
Advantages: streamlined procedure, no overhead costs, access to first-time homeowners' benefits when applicable (never for A/1, A/8, or A/9), transparent tax regime. For more information on these benefits and the checks the notary performs during the deed, please refer to the guide dedicated to the role of the notary.
Please note: the property is fully incorporated into the estate. Upon the owner's death, succession begins, with the application of the inheritance law established pursuant to EU Regulation 650/2012 and the Italian inheritance tax on assets located in Italy. For an estate spread across multiple jurisdictions, this can create significant procedural complexity.
Typical profile: buyer who uses the property as a primary or secondary residence, with a linear family structure and estate planning already defined elsewhere.
Option 2. The simple real estate company
The simple partnership is a typically Italian instrument, widely used in family wealth management.
Advantages: it allows ownership of the property to be separated from management, facilitates generational transfer (shares, not properties, are transferred), allows family governance to be regulated through corporate agreements and bylaws, and offers a greater degree of confidentiality than direct ownership.
To consider: incorporation with a notarial deed, recurring administrative requirements, and, crucially, the transfer of the property to a simple partnership is a taxable conveyance. If the structure is built after the purchase, it will be subject to double taxation.
Typical profile: family with multiple properties in Italy, multigenerational horizon, need for structured asset governance.
Option 3. The trust
The trust is recognized in Italy by virtue of the 1985 Hague Convention, ratified by Law 364/1989. It is not an institution under Italian domestic law, but a validly constituted foreign trust produces effects in Italy.
Advantages: asset segregation, protection from the settlor's personal circumstances, flexibility in defining beneficiaries, continuity of management.
Carefully evaluate: Decree 139/2024 extended inheritance and gift tax to transfers arising from trusts, with specific regulations. Furthermore, many common law trust structures do not fully correspond to Italian inheritance law and may result in higher tax rates or uncertainty in their application. Prior consultation with an advisor specializing in cross-border inheritances is essential.
Another factor: the Italian legitimate portion cannot be waived by a trust when the succession is governed by Italian law. The trust does not eliminate the rights of the forced heirs.
Typical profile: complex and multi-jurisdictional assets, asset protection needs, beneficiaries with special situations.
Option 4. The foreign capital company
Some buyers consider registering a property in Italy in the name of a foreign company. This is a decision that requires great caution.
Note: Real estate in Italy still generates Italian-source income, taxed in Italy. A foreign company that owns real estate in Italy can establish a permanent establishment. Property tax (IMU) is due. The overall tax regime is often less favorable than direct ownership, and the structure may attract the attention of thetax authorities for tax purposes.
For most residential buyers, this option rarely produces the expected benefit.
When deciding how to register a property in Italy
The detention structure is not reversible at zero cost.
Transferring a property from an individual to a limited liability company requires a new notarial deed, with registration, mortgage, and land registry taxes calculated on the value of the property. On a €5 million property, a misplaced deed can cost hundreds of thousands of euros.
For this reason, how to register a property in Italy must be decided during the due diligence phase, even before the purchase proposal is made, by coordinating the notary, the Italian tax advisor, and the tax advisor from the country of residence.
Two elements complete the picture for those buying from abroad. If the transaction involves a transfer of tax residency, the reference is the guide to the flat tax for new residents; if, instead, the market context in which the choice is made is of interest, the analysis is in the guide to the luxury real estate market. Those unable to attend the signing can find available solutions in the guide on obtaining a notarized power of attorney from abroad.
The Spinaci Notary Firm assists international clients in structuring high-end real estate transactions: incorporation of simple partnerships and corporations, deeds of transfer, recognition of foreign trusts, donations, and estate planning. Notary Federica Spinaci operates in Italian and English.
For a confidential consultation, call 06.807.0943 or fill out the contact form below the article.
