ITALY Trends and Developments Contributed by: Guglielmo Maisto, Marco Cerrato, Alessandro Bavila and Stefano Tellarini, Maisto e Associati
of ownership over the underlying assets, rather than the income tax characterisation of the trust structure. The absence of an IVAFE liability does not eliminate all compliance obligations. Although Italian-resident beneficiaries are not required to report the underlying assets held by foreign trusts, they remain obliged to disclose their interest in the trust in their Italian income tax return, in accordance with the applicable reporting framework. The Italian Reform of Restitution Claims: A Game Changer for Donated Real Estate Law No 182 of 2 December 2025 fundamentally reshapes the regime governing restitution claims fol - lowing successful forced heirship actions, revising Articles 561, 562, 563, 2652 and 2690 of the Italian Civil Code. The reform is highly relevant for private client practitioners, real estate professionals and lend - ers, as it materially enhances both the marketability and bankability of assets of donative origin. At its core, the reform addresses the longstanding ten - sion between inter vivos gifts and the Italian forced heirship system. Under Italian law, close family mem - bers – primarily the spouse, descendants and, in the absence of descendants, ascendants – are entitled to a reserved share of the estate. This entitlement is determined by reference to a notional estate, compris - ing assets held at death, plus lifetime gifts, net of lia - bilities. Where gifts infringe this reserved share, forced heirs may bring an action in reduction to restore their statutory entitlement. Historically, the greatest uncertainty arose in scenarios where gifted real estate was subsequently sold by the donee to a third-party purchaser. If, upon the donor’s death, the residual estate proved insufficient to sat - isfy the forced heir’s rights, the heir could challenge the original gift through a reduction action. Where the donee lacked the means to satisfy the resulting claim, the forced heir could ultimately bring a restitution action against the third-party purchaser – effectively exposing bona fide purchasers to the risk of losing the asset or compensating its value in cash. As a result, the purchase of properties of donative origin were tra - ditionally perceived as structurally risky.
The 2025 reform introduces a decisive reallocation of risk. The reduction of a gift no longer affects third-par - ty purchasers unless the action in reduction was regis - tered prior to the transfer. Registration priority is now the key determinant: where the purchaser’s title is reg - istered before the forced heir’s action, the purchaser is fully protected. In practical terms, a once proprietary risk is now effectively converted into a purely mon - etary claim against the donee, who remains liable to compensate the forced heir up to the amount required to restore the reserved share. A more nuanced approach applies where the asset is not sold but further gifted by the donee. In such cases, the reform preserves a residual monetary remedy: if the original donee is wholly or partially insolvent, the subsequent gratuitous transferee may be required to compensate the forced heir, albeit only up to the value of the benefit received. The new regime applies to successions opened as from 18 December 2025. For earlier successions, the previous rules will continue to apply only where the action in reduction had already been notified and registered prior to the entry into force of the reform, or is notified and registered by 18 June 2026. For these pre-reform successions, the same protection may alternatively be preserved by timely notification and registration of an out-of-court opposition to the gift within the same deadline. Absent such steps, the new regime will apply once the six-month transitional period ending on 18 June 2026 expires. Overall, the reform significantly enhances the attrac - tiveness of lifetime gifts involving Italian real estate as a succession planning tool. In most cases, donative provenance should no longer constitute a structural barrier to resale or financing, to the clear benefit of lenders taking such assets as collateral. While resti - tution claims have not been entirely abolished – and thorough due diligence remains essential – the reform removes the principal market concern that has histori - cally affected gifted assets: the risk that a purchaser for value might be divested of title following a forced heirship claim.
351 CHAMBERS.COM
Powered by FlippingBook