Italy Tax Agency Clarifies Tax Deductions for Expenses on Property Renovations by Nonresidents

The Italian Revenue Agency Oct. 27 issued Answer No. 273/2025, clarifying tax deductions for expenses regarding renovation work on Italian property by nonresidents. The taxpayer, an Italian citizen residing in Switzerland and registered with the Registry of Italians Resident Abroad (AIRE), carried out renovation and restoration work on a property in Italy used for personal, holiday, and administrative purposes. The taxpayer sought clarification on eligibility for the increased deduction rate under the 2025 Budget Law. Upon review, the Tax Agency clarified that: 1) the increased 50 percent deduction rate applies only to properties used as the taxpayer’s main residence under ...