# Purchase Taxes & Exchange Rate



## fut1a (Jul 24, 2011)

I am considering buying an apartment in Caulonia Reggio Calabria, and I am hoping to finance it with savings rather than a mortgage or loan. But I need to know what percentage of the sale price I need to put by for fees and taxes, and how do people work out the exchange rate they will get because the exchange rate now will obviously be different than it is at the time of completion?

The apartment is 125,000 euros, It is not up with an agent, and it's pre owned.

Any information would be gratefully received.


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## BBCWatcher (Dec 28, 2012)

fut1a said:


> ....how do people work out the exchange rate they will get because the exchange rate now will obviously be different than it is at the time of completion?


I can answer that question: they don't, any more than they know the price of petrol or cucumber sandwiches, say, 68 days in the future.

Therefore they have three basic choices:

1. Buy what they need now, outright, and stockpile it. For cucumber sandwiches that doesn't work too well for too long -- they spoil -- but euro are perfectly content to sit in a bank, preferably a solvent one. (Of course if the price of euro falls in the meantime, you gambled and lost. Stockpiling is itself a bet. Consequently those who choose to stockpile usually practice something called "cost averaging," e.g. "pound cost averaging." For example, they could spend 100 pounds buying euro every day at 2:38 p.m., without fail. Given enough days they'd end up with 125,000 euro, buying more euro when the price is low and fewer euro when the price is high. I'm assuming of course that fixed transaction costs are minimal or zero, otherwise you'd practice less cost averaging -- maybe buy euro every week instead of every day, or whatever.)

2. Buy an option, for example a right to buy 125,000 euro at a particular not-to-exceed U.K. pound price within a particular period of time. Financial markets offer such options. The currency futures market is quite large.

3. Just take the risk. If the euro gets more expensive (in U.K. pound terms), so be it, suck it up.

Any combination of these three choices is also possible.


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## NickZ (Jun 26, 2009)

Tax will depend on various factors.

Do you intend to claim prima casa?

Does the house even qualify?

The recorded value of the property. Not your purchase price.

They've also made some changes lately on this relating to low value homes but I doubt this would effect you.

Obviously the Notaio will have his fees.

The only real thing you can do is ask the Notaio in advance. He is the one doing the math for this and collecting the money.


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## fut1a (Jul 24, 2011)

Tax will depend on various factors.

Do you intend to claim prima casa?

Does the house even qualify?

The recorded value of the property. Not your purchase price.

Obviously the Notaio will have his fees.

The only real thing you can do is ask the Notaio in advance. He is the one doing the math for this and collecting the money.[/QUOTE]

I would not be claiming prima casa because the apartment would be a holiday home.

I was hoping someone would have an idea of what the charges are. Not sure I can ask the Notaio when I am in the UK, and when I have tried to ask questions using various translate sites no Italian can understand it :confused2:


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## NickZ (Jun 26, 2009)

You'll need to talk to the Notaio at some point. If you're Italian is too weak to understand he'll require you to get a translator.

The problem is nobody here knows all the factors. What is the registered value? What class is it? You didn't answer about Prima casa.

The changes mandate a minimum tax payment now of I think 1000€. It mainly effects really low priced properties. At least I think it's 1000. Above that there are precentages.

http://www.agenziaentrate.gov.it/wp...ERES&CACHEID=e9b729004289338f9c11ffe4308d5f44

read that. But it hasn't been updated in years. It'll give you the percentages but you need to know what the registered value is.


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