FACADE BONUS: further clarifications

The Revenue Agency has provided further clarifications regarding the tax deductions relating to the 2020 facade bonus. 

Through an interview, clarification was requested regarding the facade bonus 2020. In particular, the applicant asked whether:

• based on the reference contained in paragraph 223 of article 1 of the 2020 Budget Law to the provisions of the regulation referred to in the decree of the Minister of Finance dated 18 February 1998, n. 41, for the purposes of the facade bonus, the methods established for the deduction due pursuant to art. 16-bis of the TUIR for recovery interventions of the building heritage and if the expenses incurred for accessory works that serve for the execution of the works are also deductible, such as, for example, those for the management of the works, coordination for safety, replacement of the drainpipes;

• the costs for the restoration of balconies only, without interventions on the facades, are included in the facade bonus and, where there is an obligation to insulate the facade envisaged by paragraph 220, these insulation works also fall under the aforementioned bonus;

• for interventions already started in 2019, but whose payments are made in 2020, you can take advantage of the facade bonus and if a particular reason must be used for the payments.

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With answer no. 191, the Revenue Agency first of all recalled that 'article 1, paragraphs 219 to 223 of law 27 December 2019, n. 160 (Budget Law 2020), regulates a deduction from the gross tax equal to 90 percent of the documented expenses incurred in the year 2020 for interventions aimed at the recovery or restoration of the external facade of existing buildings located in zone A or B pursuant to the decree of the Minister of Public Works of 2 April 1968, n. 1444 (so-called 'facade bonus)'.

Referring to the specific questions posed by the applicant, the Revenue Agency clarified that the facade bonuses also includes the expenses incurred for the ancillary works needed for the execution of the eligible works, including those indicated by the applicant, for works management, safety coordination, replacement of downspouts. The facade bonus also applies to restoration work on balconies without work on the facades.

The Revenue Agency then specified that 'where the conditions indicated in paragraph 220 apply (interventions on the facades which are not only external cleaning or painting, but are also influential from a thermal point of view or which affect more than 10 percent of the plaster of the overall gross dispersing surface of the building), the expenses relating to the execution of such works fall within the facade bonus provided that the requirements indicated in the decree of the Minister of Economic Development are respected. 26 June 2015 ('minimum requirements' decree) and the limit values of the thermal transmittance of the opaque vertical structures making up the building envelope indicated in Annex B to Table 2 of the decree of the Minister of Economic Development 11 March 2008. For the same purposes, it is also necessary that the same procedures and obligations are applied as required for interventions on the building envelope by the so-called 'ecobonus' and, specifically those indicated in articles 4 and 7 of the aforementioned decree of 19 February 2007'.

Regarding the possibility of admitting to facade bonuses the expenses incurred in 2020 for interventions already started in 2019, the Revenue Agency explained that in circular no. 2/E of 2020, in paragraph 219, the term 'documented expenses incurred in the year 2020' is used, without other conditions aimed at limiting the application of the 'facade bonus' to the start date of the interventions'. Therefore, for the attribution of expenses it is necessary to refer, for natural persons, including those practicing arts and professions, and for non-commercial entities, to the cash criterion and, therefore, to the date of actual payment, regardless of the start date of the interventions to which the payments refer. For example, an eligible intervention started in July 2019, with payments made in both 2019 and 2020, will allow the use of the facade bonus only with reference to expenses incurred in 2020'.

As regards theattribution to the tax period, answer no. 191 of the Revenue Agency clarified that 'for expenses relating to interventions on the common parts of the buildings, the date of the transfer made by the condominium is relevant, regardless of the date of payment of the condominium installment by the individual condominium owner. For example, in the case of a bank transfer made by the condominium in 2019, the installments paid by the condominium in 2020 do not give the right to the facade bonus; otherwise, in the case of a transfer made by the condominium in 2020, the installments paid by the condominium in 2019, 2020 or 2021 (before the presentation of the tax return relating to 2020) give entitlement to the facade bonus.

Regarding the method of filling out the bank transfer to be used for payment of expenses for the purposes of the facade bonus, the Revenue Agency has clarified that 'it is necessary that the transfer is completed in such a way as not to jeopardize compliance by the banks and Poste Italiane Spa with the obligation to make the withholding tax payable by the beneficiary of the payment, provided for by the aforementioned article 25 of Legislative Decree no. 78 of 2010, reporting all the data necessary for this purpose (the tax code of the beneficiary of the deduction and the VAT number or the tax code of the person in favor of whom the transfer is made)'.

The Revenue Agency then recalled that the transfers already prepared by banking and postal institutions for the purposes of the ecobonus referred to in Article 14 of Legislative Decree no. can also be used for the facade bonus. 63 of 2013 'or the deduction foreseen for the recovery interventions of the building heritage referred to in the aforementioned article 16-bis of the TUIR, indicating, where possible, as the reason, the details of law no. 160 of 2019'.

If it is not possible to report these regulatory references and the compliance by banking or postal institutions with the obligation to make the withholding tax is not definitively jeopardized, it is still possible to obtain recognition of the relief.