The Court of Cassation, with theordinance no. 23978 of 6 September 2024, reiterated an important principle: force majeure cannot be invoked by the taxpayer who does not comply with the obligation to sell his property within one year of purchasing a new home, even when the previous property is unusable.
The decision confirms that the tax benefit granted for the purchase of a second home is subject to compliance with specific conditions, which the taxpayer knows at the time of purchase.
The case examined concerns a taxpayer who, after purchasing a new home with the “first house“, failed to sell the pre-owned property within the expected year, citing theunusability of the same due to the damage caused by the 2009 L’Aquila earthquake. Despite this, the Court considered this justification irrelevant, since the state of unusability was already known to the taxpayer at the time of the new purchase, and therefore cannot be considered an unforeseeable event and inevitable, necessary to invoke force majeure.
This orientation of the Court of Cassation reinforces the need to precisely fulfill the obligations established by the legislation on “first home” incentives, highlighting that failure to sell within the established deadlines inevitably leads to the revocation of the tax benefit.
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The obligation to sell and the “first home” benefits
The “first home” concessions are governed by note II-bis of article 1 of the tariff, part one, attached to Presidential Decree no. 131/1986, which regulates the facilitated regime for registration tax. Following the changes introduced by law no. 208/2015, those who already own a home purchased with subsidies are also allowed to benefit from a new subsidized purchase, provided that the first home is sold within one year of the new purchase.
The key element of this legislation is the subordination of the tax benefit for the second property to compliance with the obligation to sell the first. Otherwise, the taxpayer incurs the forfeiture of the benefit, with the obligation to repay the tax difference plus penalties and interest.
In this context, the Court of Cassation, with order no. 23978 of 2024, dealt with the case of a taxpayer who, after purchasing a second home with benefits in 2016, did not sell the first property within the expected year, appealing the unusability of the same caused by the 2009 earthquake.
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The case
The case analyzed by the Court of Cassation concerned a taxpayer who had purchased, with the “first home” benefits, a new home in 2016. However, the pre-owned property, purchased with the same benefits in 2006, had not been sold within one year, as required by law. The taxpayer justified the failure to sell by claiming that the first home was uninhabitable due to the damage suffered during the 2009 L’Aquila earthquake.
According to the taxpayer, the unusability of the property constituted an unforeseen and unavoidable circumstance, which should have justified the failure to comply with the disposal deadline envisaged to maintain the tax breaks on the second purchase.
His defense was therefore based on the request to apply the force majeure exemption.
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The response of the Supreme Court
The Court of Cassation, however, rejected the taxpayer’s appeal. The judges underlined that the unusability of the pre-owned property could not be considered as a cause of force majeure, as it was not an unforeseeable or unexpected event, but a condition already existing at the time of the new purchase.
Consequently, the taxpayer, despite being aware of this situation, had nevertheless assumed the obligation to sell the property within one year.
The legislation regarding “first home” incentives requires the buyer to make certain declarations at the time of purchase and, in the specific case, the taxpayer had declared the commitment to sell the pre-owned property. The unusability, despite being an obstacle to the sale, did not exempt the taxpayer from this obligation, since the situation was already known and did not constitute an extraordinary, external and unavoidable event, which could have justified the application of force majeure.
As established by law, failure to sell the property within one year resulted in the forfeiture of the tax breaks granted for the new purchase. The Court also reiterated that the rules providing for tax benefits must be interpreted restrictively, and external circumstances that do not fall within the legal requirements cannot be invoked.
In light of these considerations, the revocation of the benefits by the financial office was confirmed legitimate, as was the taxpayer’s obligation to repay the tax difference due, together with the related penalties and interest.