Imposta Comunale sugli Immobili (ICI)
It is a local municipal property tax and it is paid by anyone who owns property or land in Italy, whether they are a resident or non-resident. It is approximately 0.4% - 0.7% of the official value of the property. The tax is paid in two instalments, June and December.
Some municipalities raise additional local taxes. These are generally less than €500 per year.
A non resident individual receiving rental income from an Italian property is obliged to submit an annual Income Tax return. This return will only detail Italian sourced income, which is taxed at between 19% and 40%, depending on the amount.
National Income Tax
There is also a tax to pay upon the notional rental value of your house, even if you do not actually rent it out. This is based on the official rendita catastale (official value).
Capital Gains Tax (Imposta sostitutiva sulle plusvaenze)
Capital Gains tax on property is 20% and it is paid at the Contract of sale through the notary by owners who want to sell their property before 5 years from the purchase date. Only primary house owners don’t have to pay this kind of tax.
It is important to point out as Capital Gains Tax is an option tax instrument but people, who decide not to use this instrument, has to pay a higher tax rate for their capital gains (Income Tax).
Both resident and non-resident owners are subject to Italian inheritance law, with the amount of tax paid varying depending on the relationship between the deceased and the heirs.