First-time buyer incentives: a single two-year period
Disagreements over change of residence, repurchase and tax credit have been resolved
Key points
The conditions for obtaining the first-time buyer scheme have been harmonised, including for those who have already taken out a mortgagethe deed of sale: Article 41 of the 2027 Budget Bill facilitates the purchase of homes by bringing order to the current jumble of conditions that must be met to qualify for the benefit, which is the result of legislation that has accumulated over time without any consistency.
It is interesting to note that, technically speaking, these are amendments to the Consolidated Act on Indirect Taxes (Legislative Decree 123/2025), which will come into force on 1 January 2027, and which will also affect those who, on that same date, find themselves in a situation where the ‘previously applicable time limits have not yet expired’. Let us therefore examine what these time limits are.
What’s changing
The current law (Note II-bis, paragraph 1, point A, of Article 1, Schedule Part One, annexed to Presidential Decree 131/1986) stipulates that the first-home tax relief (2 per cent registration tax and 4 per cent VAT) applies to those who already have their residence in the municipality where the property is situated the property being purchased under the preferential scheme, as well as to those who transfer their residence there within eighteen months of the date of the deed of sale.
The new regulation (Note I, paragraph 1, point A, of Article 1, Tariff, Annex 1, Part I, attached to Legislative Decree 123/2025) extends to two years the deadline for changing one’s residence. For example, if Mr X bought the house on 20 October 2025, the deadline for transferring his residence will no longer be 21 April 2027, but will become 21 October 2027.
The current paragraph 4 of Note II-bis stipulates that the first-home tax relief is forfeited and a penalty is imposed on anyone who sells a property purchased under the tax relief scheme before five years have elapsed from the date of the deed of sale. However, this loss of entitlement is avoided if, within one year of the sale (ruling 314/2025), the taxpayer proceeds to purchase another property (not necessarily qualifying for the first-home tax relief again) and uses it as their main residence.
