Having started a non-business holiday-home and short-term rental activity in Puglia, without a VAT number, in a property I own, I would like to know whether the renovation expenses incurred by my parents may qualify for building renovation tax relief. I live with my parents and we are included in the same family register. They made the required traceable bank transfers and named me as the beneficiary of the deductions.

Given that the property is used for short-term holiday rentals, I would also like to know whether I can register it as my main residence and use it during periods when there is no demand from guests, and how this would affect taxes such as IMU.

Giuseppe

Answer by Andrea Mifsud, lawyer in Milan

In the situation described, the tax deductions available for building work must be considered separately from the rules governing registered residence and IMU taxation.

Regarding the first issue, the fact that the property is used as a holiday home or for short-term rentals on a non-business basis does not in itself prevent access to tax deductions for building renovation work, provided all statutory requirements are met.

If your parents were living with you and included in the same family register when the work began, and they actually paid the expenses through the required traceable bank transfers, they may claim the deduction under Article 16-bis of the Italian Consolidated Income Tax Act (TUIR) as cohabiting family members of the property owner.

In that case, it was not correct to name you as the beneficiary of the deduction if your parents incurred the expenses. The right to the tax deduction belongs to the person who actually paid the costs.