Rent to Buy Tax regime is regulated by the Italian Revenue Agency Circolare 4/E 19.02.2015 (Agenzia delle Entrate).
This legal source clearly states transfer tax will be partially anticipated at the moment the Buyer will sign the Rent to Buy agreement and the balance at the moment of the Deed of Sale (Rogito), meaning when the purchase will be completed.
For what concerns the monthly “use” rate of the property, the Rental Tax Law will apply as 2% Register Tax on the related amount (if the seller is a physical person); On the other hand if the seller decides to pay his rental income tax choosing the Flat Tax option (Cedolare secca), then the buyer won’t be charged with the 2% Register tax.
Referring on the agreed sale-price, 3% Register Tax will be charged at the moment of the Rent to Buy subscription in front of the Notary (Same regulation of the Preliminary Agreement).
The 3% Register Tax can be compensated (so recovered) from the transfer tax (2% in principal residence or 9 % if second home) at the moment of the Rogito.
If the seller is a company (juridical person) VAT regime will apply both for the monthly use rate and sale-price rate.
Rent to Buy represents a very flexible and convenient solution to postpone, pay partially or skip the payment of a significant part of these taxes; in fact the buyer will always have the chance to hand over the property and skip the taxes on the Rogito.
Furthermore Rent to Buy guarantees another not minor advantage: signing the contract means also you’ll “reserve that property for a fix and not variable price; considering the last 9 years of recession of the real estate market, it’d be more than concrete the opportunity to have a considerable property value appreciation.
On the other hand, using the Rent-to-Buy program buyers may elect their legal residence in Italy within the closing of the deed of sale (maximum 10 years), so transfering the property as “Prima casa” with a remarkable saving on transfer tax.