The end of tax deductions 2025 represents a topic of great interest for those planning renovation work. With circular 8/E of June 19, 2025, the Revenue Agency has provided fundamental clarifications on the future of tax deductions for homes and on the last years in which it will be possible to benefit from them.
End of Tax Deductions 2025: Updated Rates
According to what has been established, the tax deduction system for renovations will undergo a progressive reduction until the end of increased deductions in 2026. The rates are structured as follows:
- 36% for expenses incurred in 2025
- 30% for expenses incurred in 2026 and 2027
However, for those renovating a property intended as a primary residence, deductions remain more advantageous:
- 50% for expenses incurred in 2025
- 36% for expenses incurred in 2026 and 2027
These incentives will therefore progressively decrease, with the prospect of the end of increased tax deductions in 2026 for most taxpayers.
Primary Residence: the Decisive Clarification
A fundamental aspect clarified by the circular concerns the primary residence requirement. The increased tax benefit applies even if the property becomes a primary residence only upon completion of the work. It is not necessary for it to be so at the time of starting the renovation.
This means that those intending to transfer their residence to the renovated property will still be able to access the higher tax deduction, provided that upon completion of the work the dwelling becomes their habitual residence.
Why is it Important to Act before the End of Tax Deductions 2025?
The end of tax deductions 2025 marks the conclusion of a historic phase for the renovation sector. After this date, the benefits will undergo further downsizing, making construction work less convenient.
Those wishing to take advantage of the most favorable rates must plan the work and incur expenses by 2026 to obtain the maximum tax benefit.
Regulatory References
The concept of primary residence, essential for accessing the increased deduction, is governed by paragraph 3-bis of article 10 of the TUIR. The regulation clarifies that it refers to the property in which the taxpayer or their family members habitually reside, regardless of any permanent hospitalization, provided that the property is not rented.
Learn More
For further details, consult the official circular of the Revenue Agency:
Building Bonus Circular June 19, 2025
