Inheriting Property in Italy: Succession Law, Tax, and Estate Planning

Italy reserves a fixed minimum share of every estate for close family, and no will can remove it. Most international owners of a Tuscan property have never planned around that fact. They have no Italian will, have not spoken to an Italian notary, and assume the law they grew up with governs the house. It does not, and the gap surfaces at exactly the wrong moment.

The 2026 reform raised the direct-line allowance and severed the link between lifetime gifts and the final estate, which in effect doubled the planning room for families who move carefully. The system itself is settled. What it invites, if left alone, is avoidable tax, a slow succession, and friction among heirs, all of which a properly drafted will and an hour at the notary resolve well in advance.

Which succession law applies? The EU Succession Regulation

The law of the country where the deceased last habitually lived governs the whole estate. Since 2015 the EU Succession Regulation has fixed this rule across the EU, which decides for any owner with a foreign passport and an Italian house. Someone who lives in London and owns a property in Tuscany is subject to succession under the law of their home country; someone who has moved the centre of their life to Florence falls under Italian succession law unless a choice was stated in a will.

A will can override the default. An owner may name the law of their nationality, so a foreign national resident in Italy can keep their home-country succession law in play, but the choice has to appear in the will expressly. Left unstated, habitual residence decides.

One limit matters. The regulation lets Italy protect its own forced share where the chosen foreign law would not safeguard it adequately, through a public-policy correction. Choosing your home-country law is valid, yet the Italian forced share for close relatives (Legittima) can still apply in individual cases. It happens rarely, but anyone who tells you a choice of law fully removes the Italian forced share is overstating the position.

Swiss nationals sit outside this framework, because Switzerland has not joined the regulation. The case is then resolved through each country’s private international law, and in practice Italian courts frequently apply Swiss succession law where the deceased lived in Switzerland. The outcome has to be checked case by case.

Italian succession law: the forced share (Legittima)

Italian law reserves a minimum share of the estate for close relatives, and no will can take it from them. These protected heirs (Legittimari) are the spouse, the children, and, where there are no children, the parents of the deceased. Everything outside their reserved portion is freely disposable.

How large is the forced share?

The reserved portions depend on who survives:

A protected heir who is passed over, or left less than their reserved share, can bring a claim to claw it back (Azione di riduzione). That claim can reach gifts the deceased made while alive, so someone who received a lifetime gift can still be pursued by forced heirs after the donor dies.

The deeper difference from the common-law and German models is what the forced heir actually receives. In several systems the reserved heir gets only a money claim against the estate. Under Italian law the forced heir takes a share of the assets themselves and becomes a co-owner of the property. Every co-owner then has to agree before the house can be sold, which is where inherited Italian property tends to stall.

Italian inheritance tax: the 2026 reform

Italian inheritance tax (Imposta di Successione) stays low for close family, and from 1 January 2026 the framework was reset, holding the direct-line allowance at a level that absorbs most family transfers without any tax at all.

Rates and allowances

Take a couple passing a Tuscan property to two children. As long as each child’s share stays under the 1,000,000 EUR allowance, no Italian inheritance tax falls due. Above the allowance the 4 per cent direct-line rate applies, and even then only on the cadastral value, not the market value. Whether the line is ever crossed can be worked out on the specific property before any planning begins.

Gifts and inheritance now count separately

The 2026 reform stopped adding lifetime gifts and the final estate together when calculating the allowance, a rule previously known as the Coacervo. From 2026 the two are treated separately, which in effect doubles the allowance a careful plan can use: a parent can gift up to 1,000,000 EUR per child during their lifetime, and the full allowance is available again at death. The transitional treatment of gifts made before 2026 is still being clarified by the tax authority and was not yet final as of June 2026.

What the tax is calculated on

Italian inheritance tax is charged on the cadastral value, not the market value. For older Tuscan stock the cadastral value sits well below what the house would sell for, so the effective burden is lighter than the headline rate suggests. That is why most direct-line inheritances of a Tuscan home produce a small bill or none. The cadastral value is the same base used for taxes when buying property in Italy.

Double taxation: does the tax fall due twice?

For real estate, the country where the property sits taxes the inheritance, and the treaties between Italy and the main home countries prevent the same property being taxed twice. A house in Tuscany is subject to Italian inheritance tax wherever the deceased and the heirs live. The home-country position then determines whether anything further is owed.

Germany taxes its residents on worldwide assets, so a German heir is in principle taxable there too, but the inheritance tax paid in Italy is credited against the German liability. Because the Italian allowance is high (1,000,000 EUR per child) and the rate low (4 per cent in the direct line), most Italian inheritances carry little or no Italian tax to credit. The German domestic allowances (400,000 EUR for a child, 200,000 EUR for a grandchild) then usually absorb a typical holiday home in the 500,000 to 1,500,000 EUR range, so an actual double burden is rare.

Austria abolished inheritance tax in 2008, so there is nothing to double up. Italian inheritance tax falls due and no Austrian credit is needed.

Switzerland taxes inheritance at cantonal level, and the rates vary widely across cantons. The treaty assigns the Italian property to Italy; whether the canton also grants relief depends on the specific canton.

Estate planning during your lifetime

A few hours of planning while you are well is what keeps the succession clean, and Italian law gives you the tools to do it. Three of them carry most of the weight: the way you hold the property as a couple, a will drafted under Italian law, and, in larger estates, a lifetime transfer structured around usufruct.

Usufruct and bare ownership

The most common lifetime tool in Italy is splitting ownership: the parent transfers the bare ownership (Nuda proprietà) to the children but keeps the usufruct (Usufrutto), the right to live in the house and draw any rental income for life. The children become the owners on paper but can sell freely only after the survivor dies. The parent gives up nothing in daily terms and moves value out of the estate early.

The tax logic is favourable. A lifetime transfer uses the gift allowance, which matches the inheritance allowance at 1,000,000 EUR per child, and because gifts and inheritance now count separately, the allowance is whole again at death. The retained usufruct lowers the taxable value of the gift, since bare ownership is worth less than full ownership, with the discount calculated by age under the official valuation tables.

The trade-off sits with the next sale. A gifted property can be challenged by forced heirs, and under Italian law it is harder to sell until ten years after the donor’s death, with some lenders declining to finance it in that window. That weighs on the eventual buyer, but it is why this route belongs in a plan built with a Commercialista.

How you hold the property as a couple

Italian law puts married buyers into community of property by default (Comunione legale dei beni), so the house belongs to both spouses in equal shares whatever each paid and whatever regime governs the marriage at home. At death the survivor already owns half outright, and only the other half passes as an inheritance, subject to the forced shares above.

Separation of property (Separazione dei beni) is available, but it has to be declared in the purchase deed, before or at signing. A marriage contract signed at home does not carry over on its own. Declaring separation at the notary keeps each spouse’s assets distinct and makes the later succession considerably simpler, which is why it is worth raising before the deed is signed, not as an afterthought.

A will under Italian law

A will drawn under Italian law is worth having even when one already exists at home, because it settles the Italian property quickly and on Italian terms. Italian law recognises two forms.

The public will (Testamento pubblico) is drawn before a notary and two witnesses, who keep and register the original. It costs 1,000 to 1,500 EUR and takes effect immediately at death, with no question of authenticity and no apostille required. The handwritten will (Testamento olografo) is written, dated, and signed entirely by the testator; depositing it with a notary costs 300 to 500 EUR. Its weakness is that it can be contested and must be formally opened and registered after death, adding four to twelve weeks.

The reason to keep a separate Italian will is speed and control. A foreign will has to be translated, apostilled, and checked by the Italian notary, a process that runs into months, whereas a will held by an Italian notary takes effect within days. The Italian will can also state the choice of law expressly and deal only with the Italian property, leaving the home-country will untouched.

The two wills have to agree. If the home-country will disposes of “the entire estate” and the Italian will deals separately with the house, the wording must not collide. The clean solution is a line in the home-country will noting that the Italian real estate is covered in a separate Italian will, with each notary aware of the other document.

The inheritance tax return (Dichiarazione di Successione)

After a death, the inheritance tax return has to be filed with the tax authority within 12 months wherever the estate includes Italian property. It is the basis for assessing any tax and for transferring the cadastral records into the heirs’ names (Voltura catastale). The file holds the death certificate, the will if there is one, the land registry and cadastral data, the heirs’ identity documents, and bank balances and other Italian assets.

The return itself is free; the cadastral transfer costs 55.41 EUR plus a 16 EUR duty stamp per property. An accountant who prepares the return charges 500 to 2,000 EUR, more where there are several heirs or missing documents. Miss the 12-month deadline and the penalty runs 120 per cent to 240 per cent of the tax owed, which is small when the allowance has already wiped out the bill. The sharper consequence is practical: until the return is filed, the heirs cannot sell the house.

A practical checklist: what to settle now

For an international owner of an Italian property who has not yet addressed the succession, five steps cover almost every case.

1. Check how the property is held. Read the purchase deed (Rogito): does it say Separazione dei beni or Comunione legale? If it says community of property, consider switching at the notary.

2. Draw up an Italian will with a notary near the property, stating the choice of law and showing the notary the home-country will.

3. Align the home-country will by adding a reference to the Italian will and ruling out any contradiction.

4. For a property above roughly 1,500,000 EUR, where the aim is to use the allowance across both gift and inheritance, consider a lifetime split of ownership. The separate treatment of gifts since 2026 strengthens the case. Take this to a Commercialista. Owners who are also thinking about moving their tax residence to Italy should note that Italy’s flat tax for new residents changes the planning arithmetic for foreign-source income and is worth reviewing at the same time.

5. Engage advisers in both countries: the home-country adviser knows the treaty; the Italian Commercialista handles the return and the allowance calculation.

This amounts to two to four appointments over four to eight weeks, and 2,000 to 5,000 EUR for the will, the tax advice, and any notarial adjustment to the ownership regime. An unplanned succession starts at 10,000 EUR and adds months to the process.

Selling an inherited property

Selling a house you inherited in Italy is lighter on tax than a normal resale, but a shared inheritance can stall the transaction. For the full picture on the selling process and tax, see the guide on selling property in Italy.

Inheriting triggers no capital gains tax, and the property passes to the heirs at its value on the date of death. When the heirs later sell, the five-year capital gains rule (Plusvalenza) that catches a quick resale of a purchased property does not apply to inherited property, so a sale above the inheritance value is free of that tax at any point.

The real obstacle is agreement. Where several heirs inherit together, all of them must consent to sell, and a hold-out is the most common cause of delay. A court-ordered split is possible but slow and costly; an agreed division at the notary (Divisione consensuale) is the route that actually closes.

Common mistakes

The most common error is having no will at all. Without one, the statutory order of succession applies under whichever law governs, and the result may not match what the deceased intended. A will takes an hour to draw and saves months later.

Many international owners assume their home-country law applies to the Italian property on its own. It does only if the deceased lived in their home country at the time of death. Anyone whose habitual residence is Italy is inherited under Italian law unless a choice was made in a will.

Buying without declaring the ownership regime leaves a married couple in Italian community of property, which can surprise the family at death. Correcting it later is possible but laborious.

Some advisers are still working from the pre-2026 rule that adds lifetime gifts and the final estate together. That no longer holds, and the separate treatment opens planning that is worth using. A plan built on the old logic leaves allowances on the table.

A home-country will and an Italian will that are not coordinated create a conflict that has to be untangled by a court. The solution is to coordinate them from the start, with each notary aware of the other document.

FAQ

Do I need an Italian will if I already have one at home?

It is strongly advisable. The home-country will is valid in Italy, but it has to be translated, apostilled, and checked before it can be used, which runs into months. A will deposited with an Italian notary takes effect within days, deals only with the Italian property, and can state the choice of law expressly. The two documents sit side by side as long as they are coordinated and do not contradict each other.

How much inheritance tax falls due on a property worth 1.5 million EUR?

Passed to two children, each inherits 750,000 EUR, below the 1,000,000 EUR per-child allowance, so no Italian inheritance tax falls due. Passed instead to a nephew, there is no allowance and the rate is 6 per cent, charged on the cadastral value. Because the cadastral value sits well under the market value, the effective bill is lower than the market figure would imply. The exact number is worked out on the specific property.

Can I bypass the Italian forced share by choosing my home-country law?

Only partly. The choice of law in a will is valid, and your home-country reserved share can take the place of the Italian one. But the regulation lets Italy apply a public-policy correction, so the Italian forced share can still apply in individual cases despite the choice. There is no guarantee it is fully displaced, and anyone who promises otherwise is overstating the position.

What does settling an estate cost in Italy?

A straightforward case, with a will in place, a clear succession, and no dispute, runs 3,000 to 8,000 EUR across the notary, the tax return, and the land-registry change. Where several heirs disagree, documents are missing, or the matter reaches litigation, it starts at 10,000 EUR and climbs. The inheritance tax return has to be filed within 12 months of death, and the land-registry transfer that lets the heirs sell depends on it.

Can I transfer the property to my children during my lifetime?

Yes, by a notarial gift (Donazione). The gift allowance matches the inheritance allowance at 1,000,000 EUR per child, and since gifts and inheritance now count separately, the allowance is whole again at death. The trade-off is at the eventual sale: a gift can be challenged by forced heirs, and the property is harder to sell until ten years after the donor’s death. Keeping the usufruct lets you continue living in the house meanwhile.

Do I pay inheritance tax at home as well if I inherit a property in Italy?

For a German heir, in principle yes, since Germany taxes residents on worldwide assets, but the tax paid in Italy is credited against the German tax. Because the Italian allowance is high and the rate low, most Italian inheritances leave little Italian tax to credit, and the German domestic allowances usually cover a typical holiday home. An actual double burden in that segment is rare. Austria levies no inheritance tax; Switzerland depends on the canton.

Andrej Avi is an estate agent in Tuscany who advises owners and buyers from across the German-speaking and international markets. Request buying guidance · Current properties

Further guides: Buying property in Italy · Taxes when buying property · Due diligence

As of July 2026. General information, not legal or tax advice.