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Six things you need to know about claiming Italy’s ‘Sismabonus’

If you're planning to renovate a property in Italy, you may know there's government funding available for earthquake-proofing. But how do you access it? Here's a look at how the 'Sismabonus' works.

Six things you need to know about claiming Italy's 'Sismabonus'
Earthquake-proofing is one thing you'll have to consider when renovating a building in Italy. Photo by Daniela Turcanu on Unsplash

The name ‘Sismabonus’ might not be new to you. In fact, how could it be? The fabled Italian property bonus has been the focus of national and international media attention for some time now.

Italy has extended the Sismabonus scheme until 2024, so there’s still time to claim funding towards protecting your property from possible earthquake damage.

READ ALSO: Italy’s building bonuses: Can you really claim back the cost of renovating property?

But the typically muddy waters of Italian bureaucracy, coupled with the widespread lack of information available in English, have so far made it fairly hard (to say the least) for non-Italian-speakers to understand much about claiming the touted funds.

So, in the hope of providing some clarity on the Sismabonus, here are six things that you absolutely need to know about it.

What is it?

In a nutshell, the Sismabonus is a government-funded incentive that offers generous tax concessions to those who carry out works aimed at “seismic adaptation”, “seismic improvement” or “anti-seismic renovation” on properties located in areas at risk of experiencing earthquakes (see more about the zones below). 

First introduced in January 2017, this bonus is part of a package of economic incentives encouraging investment in construction and renovation work across Italy.

READ ALSO: The red flags to watch out for when buying an old house in Italy

As the name suggests, the bonus was created by the Italian government to tackle the endemic seismic vulnerability of many buildings across the nation.

The goal is to prepare the most at-risk areas of the country for possible seismic events. On this note, let us not forget the terrible earthquake that all but destroyed L’Aquila, Abruzzo’s capital, in 2009.

A photo from 2018 shows ongoing reconstruction efforts in L’Aquila following the 2009 earthquake. Photo by TIZIANA FABI / AFP

Who can claim it?

The bonus can be claimed by both Irpef and Ires taxpayers (i.e. both private citizens and companies) so long as they are the owners of the property in question and that they are the ones undertaking (and thus paying for) the construction works. 

Foreign nationals are as entitled to the bonus as Italian nationals are – provided, of course, that they meet the above criteria.

How much can I claim?

The amount you can claim depends on the type of work you carry out. Those who complete regular anti-seismic renovation work are entitled to a 50 percent tax deduction which must be calculated on a maximum expenditure of €96,000 for each building unit. 

The deduction is usually divided into five equal yearly instalments, meaning your Irpef or Ires tax bill will be lowered over that period.

READ ALSO: How Italy’s building ‘superbonus’ has changed in 2022

The amount you can claim significantly increases if the completed works reduce the seismic vulnerability of the property by one grade (70 percent deduction) or two grades (80 percent deduction).

Where can I claim?

If you’re renovating a building anywhere in Italy, its stability in the face of an earthquake is one of the things you’ll have to consider. But of course, some areas are more prone to seismic activity than others, and the Sismabonus reflects that.

The bonus can only be claimed for work on buildings located in seismic areas 1 (high seismic risk), 2 (medium risk) or 3 (low risk). Buildings located in zone 4 (very low risk) are excluded.

A very detailed breakdown of Italy’s seismic areas is available here. This website does not have an English version but typing the name of your comune in the webpage search tool (commando + F for Mac users) will help you find its seismic classification in no time.

READ ALSO: How to stay out of trouble when renovating your Italian property

Photo by TIZIANA FABI / AFP

How do I claim it?

Alas, here comes the tricky bit. 

The individual or company undertaking the construction works will need to provide a series of documents to the Agenzia delle Entrate (Italian Revenue Agency). These include: documents detailing the type of work being carried out and the date of its start, proof of ownership of the property and all the invoices received from the relevant building companies. Your project’s geometra (surveyor) should be able to help you obtain and submit the correct documentation.

Once all the required documentation is submitted to the Agenzia delle Entrate, all that’s left to do is to select the most suitable payment method. There are three options: tax deductions, credit or invoice discounts.

How much time do I have to carry out the work?

Some good news here: Earlier this year, the incentive’s deadline was extended to December 31st, 2024. You have until then to carry out the relevant work on your property and claim the corresponding tax deductions.

Useful resources:

For the most accurate advice on your planned renovation project and the paperwork involved in claiming tax deductions, it is important to speak to a qualified Italian building surveyor or engineer.

Online, you may find relevant information on the subject is scant and often unclear, especially for English speakers.

The most detailed information is available on the Agenzia delle Entrate’s website (available here). Again, unfortunately, there’s no English-language version, which means that you might have to rely on Google Translator’s boundless AI talent.

For more details, you can also get in touch with the Agenzia delle Entrate directly. Find contact information here

See more in The Local’s Italian property section.

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PROPERTY

PROPERTY: Should you hire a renovation agency for your Italian home?

If you're renovating a home in Italy, will you need to pay a middleman to cut through the red tape and language barriers? Silvia Marchetti looks at the pros and cons.

PROPERTY: Should you hire a renovation agency for your Italian home?

The idea of snapping up a cheap, crumbling house in a picturesque Italian village may sound appealing – but doing so always comes with tedious paperwork and the hassle of renovation.

For this reason, a growing number of professional agencies have sprung up in Italy to cater to foreign buyers snapping up cheap homes amid the property frenzy.

In many of the Italian towns selling one-euro or cheap homes, there are now ‘restyle experts’ and agencies that offer renovation services handling everything that could become a nightmare: from dealing with the paperwork and fiscal issues to finding a notary for the deed, contracting an architect, surveyor, a building team and the right suppliers for the furniture.

They also handle the sometimes tricky task of reactivating utilities in properties that have been abandoned for decades.

I’ve travelled to many of these villages and looked at this side of the business, too. Hiring these ‘middle people’ comes with pros and cons, though the positive aspects can certainly outweigh the negatives – provided you’re careful to pick the right professionals. 

READ ALSO: Why Italians aren’t snatching up their country’s one-euro homes

These intermediaries are usually locals who have expertise in real estate and a good list of suppliers’ contacts. This allows them to deliver turnkey homes that were once just heaps of decaying rubble, sparing buyers time and money – particularly those living abroad, who then aren’t forced to fly over to Italy countless times a year to follow the work in progress.

I’ve met several buyers from abroad who purchased cheap homes sight unseen after merely looking at photos posted online by local authorities, but then had to book many expensive long-haul flights to hire the architect, get the paperwork done, and select the construction team (a few even got stuck here during Covid).

Thanks to their contacts the local agents can ensure fast-track renovations are completed within 2-4 months, which could prove very useful as the ‘superbonus’ frenzy in Italy has caused a builder shortage meaning many people renovating property now face long delays

Photo by TIZIANA FABI / AFP

Their all-inclusive commission usually starts at 5 percent of the total cost of a renovation, or at 2.500 euros per house independently from its cost and dimension. The fee also depends on the type of work being carried out, how tailored it is and whether there are any specific requirements, like installing an indoor elevator or having furniture pieces shipped from the mainland if it happens to be a Sicilian or Sardinian village. 

However, buyers must always be careful. It is highly recommended to make sure the local authorities know who these agents are and how reliable they are in delivering results.

Town halls can often suggest which local companies to contact, and this gives the renovation legitimacy in my view. In a small village, where everyone knows each other, when the town hall recommends an agency there’s always a certain degree of trust involved and agents know that their credibility is at stake (and also future commissions by more clients). 

Word of mouth among foreign buyers is a powerful tool; it can be positive or detrimental for the agency if a restyle isn’t done the right way, or with too many problems.

READ ALSO: How to avoid hidden traps when buying an old property in Italy

So it’s best to avoid agencies from another village, even if nearby, who come to you offering fast and super-cheap services, or local agencies that are not suggested by the mayor’s office. 

Then of course there can be other downsides, which largely depend on how ‘controlling’ and demanding the client is. 

For those not based in Italy full-time, the most important consideration is: how much can you trust these professionals to deliver what you expect, exactly how you want it, without having to be constantly on the ground? 

Photo by Philippe HUGUEN / AFP

Language can be a major obstacle. There are technical building terms that prove difficult to translate, and if the local agency doesn’t have English-speaking renovation professionals with a track record in following foreign clients it’s best to look for an intermediary with a greater language proficiency. 

I remember meeting an American couple once who got lost in translation with a village agent for days, and had to hire a translator just to hire the intermediary.

It’s always useful to ask for a ‘preventivo’ (quote) with VAT indication, considering roughly how much inflation could make the final cost go up. Buyers should also sign a contract with the exact timeframe of the works and delivery date of the new home, including penalties if there are delays on the part of the agency. 

READ ALSO:

But, even when there is complete trust, I think it is impossible to fully restyle an old home from a distance, contacting intermediaries by phone, emails, messages or video calls only. 

Details are key and there’s always something that could be misinterpreted. Buyers based overseas should still follow-up the renovation phases personally, perhaps with one or two flights per year to check all is going well and up to schedule.

Asking to see the costs so far undertaken midway through the restyle is useful to make sure there are no hidden costs or unexpected third parties involved – like buying the most expensive furniture or marble floor when not requested, or hiring a carpenter to build artisan beds.

While there is really no such thing as a hassle-free renovation, these agencies can ease the pressure and do most of the burdensome work – but buyers’ supervision will always be needed.

Read more in The Local’s Italian property section.

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