Fiscal benefits for agricultural properties in Italy

Fiscal Benefits for Agricultural Properties in Italy

The agricultural sector in Tuscany is currently in a period of growth. According to the Unioncamere- Infocamere, the number of agricultural and food businesses managed by people under 35 has grown by more than 7 per cent. In Tuscany, over 3,000 of these businesses are headed up by people under 35, especially in the provinces of Massa Carrara, Lucca, Pistoia and Prato.

This is a dynamic sector, though it is often buffeted by the blows of an unstable economic climate and sometimes has to deal with unfair trade practices. Still, it manages to find new means of recovery and growth.

The agriculture sector is sustained not only by the labor and dedication of workers, but also by the Italian legislation. Furthermore, there are important financial and fiscal benefits for agricultural entrepreneurs. 

Who can benefit from these opportunities?

The are two main entrepreneurial roles:  the “Direct Cultivator” and the “Agricultural Business Professional” . These ones must be enrolled in the appropriate assistance and insurance plans. Briefly, the regulation defines these roles as follows:

Direct Cultivators (Coltivatore Diretto) dedicate themselves directly, habitually and prevalently to the manual cultivation of the lands, and/or to the rearing of animals. At least one-third of the labor directly involved in the agriculture business must be done by these individuals and their own family members.

Agricultural Business Professionals (Imprenditore Agricolo Professionale or IAP) are agricultural entrepreneurs who possess the professional knowledge and competencies indicated in art. 5, Regulation 1257/1999/CE. They must dedicate at least 50 per cent of their time to this activity and obtain at least 50 per cent of their earnings from it.

Fiscal benefits for agricultural entrepreneurs

Among the various benefits for those working in the agriculture sector, we should focus on those offered to the individuals wishing to acquire agriculture properties and accessories. These financial benefits have already been in force for small farm properties and, since 2013, they also apply to IAPs. They allow the acquisition of agricultural properties and accessories under a scheme of reduced taxation. In particular, only a cadastral fee of one per cent of the purchase price, and registry and mortgage taxes in the fixed amounts of 200 euro each, will be required.

These benefits are not only available to those who already possess the qualification of “Direct Cultivator” or “IAP” but they also extend to subjects who have not yet obtained these qualifications at the moment of acquiring the agriculture property and accessories, as long as they have enrolled in the welfare system for agriculture workers and have already requested these qualifications from the competent regional office. This must then be formally obtained and certified within 24 months (otherwise, the benefits will be cancelled). To appreciate better the value of these benefits, consider the situation of agricultural lands and accessories acquired by private individuals who do not meet the above requirements. The normal applicable registry tax is 15 per cent of the purchase price.

Final notes

We should note that these benefits extend to the Direct Cultivator or IAP’s spouses and family members. They can acquire the lands with the aforementioned benefits as long as the agricultural status is maintained.

These important benefits can lead to notable savings in taxes, not only for those who wish to enlarge their own agricultural activity, but also for those who wish to invest in a country with a growing agricultural sector.

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This article was originally published in Tuscany’s Grapevine Magazine and then republished in  The Florentine with the title “Fiscal Benefist for Agricultural Properties in Italy”.