Sales contract registration

Italian law stipulates that the purchase contract signed and accepted by both parties must be registered with an office of the Italian Tax Agency (Agenzia delle entrate) within 20 days from the date of signature. What is not widely known is that a proposta, a written offer signed by both parties, can also be registered with the Italian Tax Agency and this document then acquires the same legal status as a purchase contract. Registration gives both parties the assurance that an official agreement has been established with all legal consequences for fulfilment by both parties.

Down payment

To register a proposal or contract of sale, it is essential that the buyer has made a verifiable down payment directly to the seller, evidenced by bank statements. Down payments made to an estate agent or placed in a notary's third-party account do not fulfill this requirement. As discussed in a previous blog post, the deposit is a critical element in Italian contract law, thoroughly outlined in the legislation. Specifically, Article 1385 of the Italian Civil Code details the 'caparra confirmatoria' or 'confirmatory deposit' mechanism, where the recipient of the down payment is obliged to return twice the amount if they fail to fulfill their contractual obligations, thereby ensuring the buyer that a deal has been secured.

Costs

Registration incurs a fee, naturally. Nonetheless, a portion of the registration fee paid can be deducted from the transfer tax due later on.