What is IVIE?
IVIE (Imposta sul Valore degli Immobili Esteri) is Italy's annual tax on real estate located outside Italy, owned by Italian tax residents. It functions as the international counterpart to IMU — just as IMU taxes Italian property owned by Italian residents, IVIE taxes foreign property owned by Italian residents.
The standard rate is 1.06% of the property's value. It applies regardless of whether the property generates rental income or sits empty.
Who Owes IVIE
Only Italian tax residents owe IVIE. If you live abroad and are a non-resident for Italian tax purposes, foreign property you own is not subject to IVIE. The determination of Italian tax residency follows the standard residenza fiscale rules.
Conversely, if you've moved to Italy and become an Italian tax resident while still owning property abroad — an apartment in London, a house in France, a Florida condo — that foreign property triggers IVIE each year.
Calculating IVIE
The taxable base depends on what documentation is available for the property:
If the foreign country has a cadastral or tax assessed value: Use that value (similar to how Italy uses the rendita catastale for IMU calculations). This is often lower than market value.
If no cadastral value exists: Use the purchase price paid, or if acquired by gift or inheritance, the market value at the time of acquisition.
Rate: 1.06% of the taxable base.
If the property is owned by multiple parties, each owner pays IVIE in proportion to their ownership share.
Primary Residence Abroad: Reduced Rate
If the foreign property is your primary residence abroad (the place where you actually live), a reduced rate of 0.4% applies, and you may also claim a deduction of €200 from the IVIE calculated. This acknowledges that your main home abroad is more analogous to an Italian primary residence (which would be IMU-exempt) than a second property.
Foreign Tax Credits
The most significant relief available is the credit for property taxes paid in the foreign country. If you paid a property tax, council tax, taxe foncière, or equivalent local property levy in the country where the property is located, you can credit that amount directly against your IVIE liability.
The credit equals the tax paid abroad, but cannot exceed the Italian IVIE owed on that property. In many EU countries with property taxes at rates comparable to IVIE, this credit may eliminate IVIE entirely. In countries with low or no property taxes, IVIE applies in full.
Where IVIE Is Reported
IVIE is reported in Quadro RW of the Modello Redditi PF annual return — the same section used for all foreign asset reporting and for calculating IVAFE on financial assets. Payment is made via Modello F24.
Failure to report foreign real estate in Quadro RW carries the same severe penalties as failing to report financial assets: 3% to 15% of the undisclosed value, regardless of whether tax was actually due.