Most divorcing couples will need to resolve the financial matters that arise as a result. If they are unable to reach agreement between them, then they will have to make...
The transfer of Italian assets following a divorce
Following a divorce, the ex-spouses must reach an agreement through financial remedy proceedings (or by obtaining a Court Order) regarding the distribution of their assets, including any assets held abroad.
You may own property in Italy and need to transfer your share in it under the terms of an English Court Order. The laws and process in Italy are different from those in the UK and we can assist you throughout.
A foreign divorce order and related financial remedy order will be recognised in Italy in accordance with its International Private Laws. The procedure for the transfer of a property from one spouse to the other must, however, follow Italian laws and specific procedure.
The transfer cannot, unfortunately, be completed simply by the parties signing a form. Instead, it requires a Transfer Deed (called a Deed of Sale, even though it is not technically a sale) to be signed by both parties in front of a Notary Public in Italy, who will then register it and arrange for the transfer of the share of the spouse’s property to the other (or the entire property, if this was solely owned by that spouse).
The Deed will state that the transfer is in accordance with the terms of the foreign Financial Remedy Order, including details of any money being exchanged.
Any Land Registry or Town Hall issues relating to the property must also be resolved prior to the signing of the Deed and the transfer of the share in the property, just as when dealing with sale proceedings. This means that if any works have been done to the property without planning permission, then a “Sanatoria” (essentially a pardon) must be obtained from the local Town Hall – a process which can be lengthy and expensive, but is unfortunately necessary.
Taxes and Costs
Other than the Notary’s fees, and any other professional’s fees and penalties due for any unresolved issues relating to the property, there will be no other costs incurred in the transfer of the property, provided that this clearly relates to the Financial Remedy Order made as a result of the Divorce.
Any property transfers that result from a separation or divorce order are exempt from property transfer taxes in Italy. Whilst this has always been the case for Italian citizens and domestic Court Orders, it’s only since 2019 that this been accepted by Notaries in relation to non-Italian individuals and foreign financial orders in relation to a divorce.
Aspects to consider during the English divorce
It’s vital that the Financial Remedy Order clearly specifies and identifies the Italian property to be transferred (as opposed to more general terms), and describes the Italian assets to be transferred in as much detail as possible. This is to remove any doubt that the property transfer is occurring as a result of the divorce, thereby allowing the tax relief to apply.
During the negotiations or the proceedings, it‘s also important to consider any other costs which will be borne by the parties in the transfer and who will be liable for what. In an ordinary sale, it’s the transferee who pays the Notary’s fees and associated costs of the sale. However, in this situation it might be appropriate for other terms to be agreed and clearly set out in the Order.
Equally, it’s vital to check beforehand whether there are any landscape or structural issues relating to the property which must be resolved and may incur time and costs. This can be done with the help of a local Surveyor or Architect.
Protecting your interests through a difficult time
Our specialist team can work alongside your UK advisers to ensure Italian property is properly described on your draft order, and that Italian transfer expenses are estimated early and accurately when agreeing financial settlements.
You can appoint us to deal with the Italian property transfer itself. This would include liaising with the Notary in Italy with regards to the Financial Remedy Order, providing all relevant documentation and appointing a local attorney to sign the Transfer Deed on your behalf.
Whatever your circumstances, we will communicate firmly but sensitively with an ex-spouse to help things run as smoothly as possible.