Nestled within the Italian peninsula lies the centuries-old micro-country of San Marino, renowned for its rich history, stunning architecture, and captivating natural beauty. Officially known as the Republic of San Marino, it is a landlocked enclave situated within the Italian region of Emilia-Romagna, close to the Adriatic Sea. Established in 301 AD, it holds the distinction of being one of the world’s oldest republics and is renowned for its preserved medieval architecture and panoramic vistas.

Despite its diminutive size, San Marino offers numerous opportunities for those looking to purchase residential property in Europe, as well as for foreign investors. In fact, the small country boasts a diverse range of residential properties, catering to various preferences and search requirements. From quaint countryside cottages to elegant apartments nestled within the historic city center, there is something to suit every taste and lifestyle.

Acquiring Real Estate in San Marino by Foreign Citizens
Foreigners keen on investing in San Marino real estate must follow specific guidelines which facilitate property acquisitions without necessitating special authorization from the government, as stipulated in Article 51 of San Marino Law No. 173 of December 24, 2018. Generally, there are no nationality-based restrictions on property ownership in San Marino. Specifically, in the case of San Marino, buyers of “foreign citizenship” refer to anyone who is not Sammarinese, meaning Italian citizens, American citizens, British citizens, for example.

However, foreign buyers must comply with legal procedures and obtain necessary authorizations from the country’s relevant authorities. Specifically, when foreigners pursue property purchases in San Marino, the notary overseeing the transaction must ensure the buyer lacks a criminal record. This involves presenting a certificate confirming the absence of convictions for serious crimes, both domestically and internationally. Just as in property purchases in Italy, foreign buyers must also obtain a Tax Code, and the urban planning compliance of the home must be verified with necessary documentation.

As conditions, foreign individuals are permitted to acquire up to two buildings, encompassing ancillary features such as garages or gardens, without encumbrance. However, acquisitions exceeding this limit necessitate special permission. For example, there are specific properties exempt from these regulations, as outlined by relevant laws, and companies primarily engaged in real estate activities are also exempt from these provisions.

Incentives for Foreign Buyers
San Marino provides numerous incentives to attract foreign investment in its real estate sector. Governed by Law No. 88 of 2008, investors can take advantage of tax breaks and incentives designed to support rehabilitation and restoration projects aimed at preserving the nation’s cultural heritage. Moreover, the government has implemented streamlined administrative procedures to simplify property transactions for foreign purchasers, thereby bolstering the attractiveness of investing in San Marino. Furthermore, citizens from certain countries, such as the United Kingdom, are eligible to benefit from no double taxation regulations. This implies that if they decide to relocate permanently to San Marino, they could enjoy tax benefits in the U.K.

Specifically, foreign investors seeking permanent residency in San Marino have the option to obtain a residence permit (permesso di soggiorno) through various investment channels. According to Law No. 86 of 2011, individuals may qualify for residency by making a substantial investment in the country, which can include purchasing real estate, establishing a business, or contributing to the local economy. The minimum investment required to obtain residency is €500,000, so in the case of a home purchase also the price of the home would have to meet or exceed that value. The applicant must also maintain the investment for at least five years, or in the case of real estate, maintain home ownership.

Special Tax Regimes
San Marino also offers tax programs to new residents who produce their income abroad. In particular, those who obtain the so called “atypical residence” are entitled to a preferential tax regime which consists in the payment of a substitute 7% income tax (with a minimum of 10,000 euros and a maximum of 100,000 euro) which must be paid in a single payment by June 30 of each year.

The “atypical residence” for pensioners, on the other hand, can be granted to pensioners coming from the EU, Switzerland or countries identified by the San Marino government provided that:

-they have an annual income of no less than 50,000 euros or assets of no less than 300,000 euros;

– they have never resided in San Marino;

A substitute 6% tax is applied to pensions in this case, and it must be paid in a single payment by 30 June of each year.

Conclusion
In conclusion, purchasing residential property in San Marino offers foreign investors a gateway to a unique blend of history, culture, and natural beauty. With legal frameworks in place and incentives aimed at facilitating investment, San Marino presents an attractive opportunity for those seeking a slice of Mediterranean paradise. Whether for personal residence or investment purposes, exploring the real estate market in San Marino can lead to a rewarding and enriching experience.

To learn more about the country of San Marino, the special tax regimes, real estate and investment opportunities there, reach out to us at info@italianrealestatelawyers.com!

 

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