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The CJEU reference that could mean a refund — and why the Italian limitation clock is already running
You moved to Italy. You kept your house in Surrey — or Edinburgh, or County Kerry. Every year since, you have paid IVIE, Italy's wealth tax on foreign real estate, on an asset that a British valuer would price in sterling but that Italian law forces you to value at acquisition cost or market value, whichever is higher. In 2024 the rate rose from 0.76% to 1.06%. On a property worth £400,000, that is roughly €4,800 per year. Across five years, you may have paid €20,000 or more on a tax whose legal basis an Italian court has just placed before the EU's highest court.
The ruling is not here yet. But the limitation period is running now. That is the only fact that matters this week.
Yes, and the obligation applies without exception. If you are fiscally resident in Italy — meaning Italy is your habitual abode, your family home is there, or you are registered in the Italian civil registry — Article 19 of Decree-Law no. 201 of 6 December 2011, as converted into law by Law no. 214/2011 (the primary legislation governing IVIE), requires you to declare and pay IVIE on every real-estate asset you hold abroad. There is no threshold. There is no exemption for properties held in countries with which Italy has a double-taxation treaty. The only relief available is a credit for any wealth tax actually paid abroad, and the United Kingdom abolished its equivalent taxes long ago.
Unlike Council Tax in England and Wales — which is a local tax on occupation, not a wealth tax on ownership, and has nothing to do with the owner's country of residence — IVIE is a national Italian tax levied annually on the owner, not the occupier. A non-resident Italian cannot owe it. A UK national resident in Italy cannot escape it. The distinction matters because many British owners assume that paying Council Tax or paying stamp duty land tax on purchase discharges some parallel Italian obligation. It does not.
This is where the dispute originates. For properties within the EU or EEA, IVIE uses the local cadastral value — the notional fiscal value assigned by the relevant land register — as the taxable base. This value is almost always lower than market value, sometimes dramatically so.
For UK property, Article 19, paragraph 15 of Decree-Law 201/2011, as interpreted by the Italian Revenue Agency (Agenzia delle Entrate), provides no equivalent: the taxable base defaults to the acquisition cost stated in the deed of purchase, or to market value if that is higher or if no acquisition cost is available. UK residential property bought ten or twenty years ago has often tripled in nominal value. The taxable base the Italian Revenue Agency applies today can therefore be three to five times what it would have been had the property been in France or Spain.
Before Brexit, this difference was at least arguably limited by EU law. After Brexit, the default assumption of many taxpayers and some advisers has been that EU arguments are simply unavailable. That assumption is wrong.
On 8 June 2026, the Como Tax Court made a reference the valuation rules of Article 19, paragraph 15 of Decree-Law 201/2011 to the Court of Justice of the European Union. The reference asks whether those rules are compatible with Article 63 of the Treaty on the Functioning of the European Union (TFEU), which guarantees the free movement of capital.
The key point the Como court identified is this: Article 63 TFEU is not limited to movements of capital between EU Member States. It applies to movements between Member States and third countries as well. The United Kingdom became a third country on 1 January 2021. It did not become a country to which EU capital-movement rules are irrelevant. A restriction that systematically overvalues assets held in a specific non-EU country — and thereby imposes a heavier tax burden on Italian residents who chose to keep capital there — may still breach Article 63, notwithstanding Brexit.
The Italian government's probable counter-argument will rely on Article 64 TFEU, the so-called standstill clause, which permits Member States to maintain restrictions on third-country capital movements that existed on 31 December 1993. IVIE was introduced in 2012. It does not pre-date 1993. The Article 64 defence is therefore unlikely to succeed on the valuation point, though the CJEU will decide.
Omnia iura in obscuro versantur dum adhuc pendet sententia — all rights remain uncertain while a ruling is still pending. The gloss is simple: a CJEU reference confirms there is a real legal question, but it resolves nothing until the judgment arrives.
Potentially yes — but not automatically, and not without action on your part. This is the part that most published commentary on IVIE omits entirely.
If the CJEU eventually rules that the overvaluation of UK property violates Article 63 TFEU, that ruling will be binding on Italian courts. Italian courts will then be obliged to set aside the incompatible national provision and grant relief. The difficulty is that Italian tax procedural law does not suspend the limitation periods for challenging tax assessments simply because a CJEU reference is pending. Under Legislative Decree no. 546 of 31 December 1992 (the Italian tax procedure code), you have 60 days from receipt of a tax assessment (avviso di accertamento) to file a formal appeal. For IVIE amounts self-declared in your annual return (dichiarazione dei redditi), the Revenue Agency has up to five years from the date of filing to issue an assessment; but your right to claim a refund of voluntarily paid tax under Article 38 of Presidential Decree no. 602/1973 runs for 48 months from the date of payment.
That means IVIE paid for the 2020 tax year, which fell due in June 2021, became potentially time-barred for a direct refund claim in June 2025 — before the Como court even issued its reference. IVIE paid for 2021 will become time-barred in the course of 2026. The clock does not wait for Luxembourg.
Unlike in most common-law jurisdictions, where a pending appellate or constitutional ruling often freezes related proceedings by operation of law or procedural practice, Italian tax courts have no automatic stay mechanism triggered by a CJEU reference. A first-instance judge may suspend a case of their own motion where a directly applicable EU question is pending, but the Revenue Agency is not obliged to pause its collection activities, and a taxpayer who does not file a protective challenge will have no claim to enforce once the CJEU rules in their favour.
For most Italian residents owning UK property, the answer is yes — with urgency for payments made in 2021 and a strong practical case for payments made in 2022 and 2023.
The recommended sequence is as follows.
First, identify every year for which IVIE was paid and the exact date of each payment. The taxable base used each year — acquisition cost, declared market value, or revised figure from a Revenue Agency notice — should be documented from your annual returns or from any formal assessments received.
Second, calculate the differential. The question a protective appeal must answer is not simply "did I pay IVIE?" but "did I pay IVIE on a higher base than I would have paid had I held equivalent property in an EU Member State?" That differential is the refund at issue.
Third, file a refund application (istanza di rimborso) with the Italian Revenue Agency within the 48-month window, referencing the Como court's interlocutory order and Article 63 TFEU. The Revenue Agency will almost certainly reject it. That rejection then opens a fresh 60-day window to file a formal appeal before the tax court (Corte di Giustizia Tributaria), which can be asked to suspend proceedings pending the CJEU ruling.
That suspension — obtained at first instance after active filing — is the correct procedural position to be in when the CJEU hands down its judgment. Without it, the judgment is useful to others. With it, it works for you.
A protective claim filed now costs a fixed court contribution of €30 to €1,500 depending on the value, plus advisory fees. The cost of not filing, if the CJEU rules for taxpayers, is the entire refund plus interest.
In our files, the most common mistake in IVIE disputes is the opposite of what you might expect: clients who received a Revenue Agency reassessment notice (avviso di accertamento), filed a query with their Italian accountant, and then waited for a response while the 60-day appeal period elapsed. The accountant confirmed the tax was probably too high. The window had closed. A timely protective appeal is not a commitment to litigate; it is a reservation of rights. The CJEU reference from Como makes this reservation materially more valuable than it was twelve months ago.
No. IVIE applies on the basis of the owner's Italian fiscal residence, not the location of the property within the United Kingdom. Scotland, England, Wales and Northern Ireland are treated identically under Italian law. The same valuation rules — and the same CJEU challenge — apply to all UK-situated real estate.
IVIE is triggered by Italian fiscal residence, not by nationality. If you spend more than 183 days per year in Italy, or your main home or centre of vital interests is in Italy, Italian law may treat you as resident regardless of whether you have formally registered at the local registry office (anagrafe). Non-registration does not eliminate the tax obligation; it may simply create an undisclosed liability.
Under Italian law and CJEU case law, a refund resulting from the incompatibility of a national tax rule with EU law carries statutory interest. The rate applied by the Italian Revenue Agency is currently 5% per annum. On a refund of €15,000, interest accrued over four years adds approximately €3,000. However, interest runs from the date of the original payment only if the refund application was filed in time. This is a further reason to act within the limitation period rather than after it.
Panato Law Firm, led by Avv. Marco Panato in Verona, Italy, advises international clients on Italian tax disputes, IVIE compliance, and cross-border wealth structuring. If you own property in the United Kingdom and are resident in Italy, the window to protect your refund rights is open now and will not remain so indefinitely. To discuss your position, write to info@panatolawfirm.com or call +39 045 5867034.
HREFLANG BLOCK:
Editorial Team — Panato Law Firm Staff
