Extension of the tax deductions for building renovation

Galletti incontra Associazione Meccanica

Pubblication date: 2014-02-28

publication date: 28.02.2014

With Italian Law Decree no. 63 of June 4, 2013, Italy implemented Directive 2010/31/EU by modifying the contents of Italian Legislative Decree no. 192 of August 19, 2005; it entered into effect as of the date following its publication in the Official Gazette, that is, June 6, 2013.

One of the most important developments is that the Italian Law Decree extends tax deductions for building renovations (article 16); in fact, for expenses incurred between June 26, 2012 and December 31, 2013, the personal income tax deduction increases to 50% and is calculated on a maximum expense limit of 96,000 euros per property unit.

The operations that are covered also include the replacement of air conditioning units with systems equipped with a heat pump. Minimum guaranteed efficiency values for the machines are not required, as was the case, instead, for energy requalification operations.

All taxpayers subject to personal income tax, whether or not they reside in Italy, may take advantage of the deduction on expenses for renovation. The deduction is divided into ten constant and equal annual amounts to be applied in the year the expenses were incurred and subsequent years.

Energy requalification operations (Art. 14): Italian Law Decree no. 63/2013 excluded from the benefit 65% of the expenses for operations involving the replacement of heating systems with high-efficiency heat pumps and low-enthalpy geothermal systems and the expenses for replacing traditional water heaters with heat pump water heaters for the production of domestic hot water.

Probably starting in August 2013 heat pumps will be able to receive the 65% bonus benefit as a result of an amendment submitted by the government employing funds from the Ministry of Economic Development.

Internal Revenue Agency

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