SHORT RENTALS? DISCOVER WITH US THE REGULATIONS FOR RENTING YOUR PROPERTY IN SARDINIA

In recent years there has been a growth in the business of tourist rentals, also known as "short-term rentals", of accommodations used as holiday homes in Sardinia.

Tourist locations are defined as those locations that meet the following requirements:

• residential properties. Therefore, not applicable to shops, offices, warehouses, land;
• the tourist rental contract must be stipulated by the holder of the real right or by a person legitimized by him;
• the short-term rental contract is stipulated between natural persons, who do not exercise any organized business activity in order to produce or exchange goods or services;
• the duration of the tourist rental contract cannot exceed 30 days;
• short-term rental taxation can be invoked for no more than four properties per person. The lease of more than four properties is, in fact, qualified as a business activity, with the obligation of a VAT number and the impossibility of opting for the dry coupon.

The tourist lease contract does not have to be registered with the Revenue Agency; therefore, it is not subject to the payment of stamp duties and registration tax, unlike leases lasting more than 30 days.

However, starting next 2023, it will also be mandatory for short-term leases of no more than 30 days and relating to residential properties, to notify the Revenue Agency of the year of the lease and the cadastral data of the rented apartment. The obligation will also concern lease contracts signed with the intervention of real estate brokers.

The holder of the real right on the property, i.e. the owner, can choose between two types of taxation for short-term rentals: he can opt for ordinary taxation for the purpose of income tax or for taxation with a flat tax on dividends (dry coupon).

IRPEF taxation is the classic method used for this purpose.

The rental cost is based on incomes from buildings and, as such, is added to the other incomes received during the year. Therefore, these amounts are subject to the Irpef rates envisaged on the total annual income, based on the echelons, to the extent of 95%. The remaining 5% is a lump sum deduction.

However, the owners of properties intended for short-term rentals can benefit from the optional regime, the so-called ‘’flax tax on dividends’’, which consists in paying a substitute tax of the Irpef and of the surcharges, as well as the registration and stamp duties relating to the lease. The rate is equal to 21% compared to the ordinary taxation by brackets and makes it possible to avoid accumulation with other income and, therefore, to obtain savings, which are more substantial, where the total annual incomes are high.

The tax obligations weighing on the owner of the property subject to tourist rentals vary if an intermediary intervenes in the transaction. When the intermediary does not limit himself to stipulating short-term lease contracts and also intervenes in the collection of rents, he applies a withholding tax of 21% on the amounts received, which he must pay to the Treasury. This sum represents a down payment and, not surprisingly, is equal to the dry coupon rate. In fact, in this way, it is avoided that the lessor who has opted for the dry coupon, is forced to comply with further payments.

Conversely, the owner who has opted for ordinary personal income tax or who has leased more than four properties, not being able to benefit from the dry coupon, must pay the difference due, as an adjustment, through F24.

However, the circular of the Revenue Agency n. 26 of 1 June 2011, established that, in the presence of objective and subjective requisites, the exercise of the dry coupon option for short-term rentals by the owner is only permitted in case of a mandate with representation.

The mandate with representation is the contract with which one party, the agent, undertakes to perform one or more legal acts on behalf of the other, the principal, subject to the granting of a power of attorney. With it, the legal effects of the acts implemented by the agent fall within the legal sphere of the principal, of which the first spends the name.

Therefore, according to the Revenue Agency, the owner can opt for the dry coupon when the real estate agency operates as a mere intermediary between landlord and tenant.

In March 2014, the Ministry of the Economy and Finance intervened in the application of the dry coupon, specifying that even the landlord who makes use of a real estate Agency is the owner of a rental income, even in the case in which intermediary a mandate is conferred without representation.

The mandate without representation, on the contrary, is the contract with which the agent acts in his own name, and cannot use the name of the represented. Third parties, therefore, have no relationship with the principal.

Therefore, even the owner who gives the agency the power to conclude lease contracts in his own name, but on behalf of the holder of the real right, can opt for the short-term flat rate coupon.

Would you like to know more about the holiday home legislation? And when do you pay the dry coupon? For further information on short-term rentals of villas in Sardinia with the intermediation of a real estate agency, you can contact our team of experts by phone or e-mail, who are available to answer your questions.

Back to the top!