The building incentive programs in Italy are undergoing a significant change, shifting towards stricter regulations and diminished tax advantages a quarter-century after their initial implementation.Here’s a comprehensive overview of the changes.
Recent Developments
The enactment of the 2025 Budget law marks a pivotal moment for thes concessions, introducing a more discerning system characterized by tighter eligibility criteria and reduced deduction percentages compared too previous years. Navigating these revised benefits now requires a more complex approach, prompting the Revenue Agency to issue Circular 8/E on June 19, 2025, to address emerging questions. Notably, the architectural barrier removal bonus remains unchanged from 2024, maintaining a 75% deduction rate over ten years for interventions meeting the technical standards outlined in Ministerial Decree 236/89. However, other incentives are facing substantial reductions. The Superbonus is now largely phased out,limited to 65% for condominiums that commenced work before October 2024. Both the Ecobonus and ordinary earthquake bonuses are also being scaled back, aligning with the renovation bonus at a 50% deduction on expenses, subject to specific spending caps. According to data from ENEA (National Agency for New Technologies,Energy and Sustainable Economic Development),approximately 67% of Italian buildings are classified as energy inefficient,highlighting the importance – and now,the increasing difficulty – of accessing these incentives for upgrades.
Revised Criteria: Property Types, Eligibility, and Limits
The types of interventions eligible for incentives remain largely consistent, with the exception of the Ecobonus, which no longer includes deductions for condensing boiler installations. The most significant changes pertain to the subjective and objective requirements for accessing tax benefits. The 50% deduction is now exclusively available for primary residences and is restricted to individuals holding a real right to the property (ownership, usufruct, or surface right). Family members within the third degree of kinship can also qualify, provided they directly incur the expenses and meet the necessary requirements. In all other scenarios, the deduction is capped at 36%. This shift reflects a broader trend in European Union policy towards targeting energy efficiency improvements specifically to homeowners, as evidenced by the recent revisions to the Energy Performance of Buildings Directive (EPBD).
Income Thresholds: Impact of Irpef Above €75,000
It’s crucial to remember that these bonuses fall within a package of reduced concessions for taxpayers with an Irpef income exceeding €75,000. The Revenue Agency’s Circular clarifies that the definition of “primary residence” encompasses associated amenities and communal building areas, such as garages and condominium facilities. Interventions related to these areas can also qualify for the 50% deduction if the owner possesses the requisite real right. conversely, individuals who have signed a preliminary purchase agreement but haven’t yet finalized the property acquisition are excluded from the 50% deduction. In such cases, the intervention is limited to a 36% deduction until legal ownership is established.This creates a potential disincentive for prospective homebuyers undertaking renovations before completing the purchase.
Timeline of Reductions
The legislation stipulates that the date of the building permit application submitted to the Municipality is the determining factor, even if work commences before the deed is finalized. A positive clarification has emerged: the property must be designated as a primary residence at the completion of the work, not at its inception, to qualify for the full deduction. While not explicitly stated in the circular, it’s reasonable to assume, by analogy, that individuals with recorded preliminary purchase agreements may still be eligible for the 36% benefit, similar to tenants and those with usufruct rights. Without further legislative changes, deductions will be further reduced from January 1, 2026: those currently at 50% will decrease to 36%, and those at 36% will fall to 30%. This impending reduction is prompting many homeowners to accelerate renovation plans to take advantage of the current, more favorable rates.