Buying Property through a Company or as an Individual: How to Guide the Choice

Anyone about to purchase a property often wonders whether to hold it in their own name or through a company, either an existing one or one set up for the purpose. This is a typical tax and estate planning choice, the outcome of which depends on three elements to be clarified before the deed of sale: the nature of the property, the use to which it will be put and the investment time horizon. The first deserves particular attention, because for a company it determines the entire applicable regime.

The nature of the property

For an individual, the distinction between an apartment, a shop or a warehouse has little impact, whereas for a company it is the starting point of any assessment. A business's properties fall into three categories: instrumental properties, used in the business or instrumental by their nature, such as offices, shops and warehouses, even when leased to third parties; stock-in-trade properties, which the company builds or purchases for resale; and investment properties, held as an investment, typically leased apartments.

This classification determines the tax treatment of costs. On instrumental properties, the company deducts depreciation, interest, maintenance and IMU (municipal property tax) under the ordinary rules for business income. For investment properties, the regime is instead less favourable, since income is determined using criteria similar to those applied to individuals, in particular by taking the higher of the revalued cadastral income and the rent, reduced only by documented ordinary maintenance expenses up to 15% of the rent itself, while other expenses, including depreciation, are not deductible. It follows that registering an apartment in the name of a company does not, in itself, allow costs to be deducted, contrary to common belief. An exception applies to interest on the mortgage taken out for the purchase, which remains deductible and which, for property management companies, is not even subject to the ordinary limits where the loan is secured by a mortgage on the leased property.

The cost of the purchase

Alongside the nature of the asset, the cost of the transaction marks the first concrete difference, and it depends on the indirect tax regime that follows from who is selling. Where the purchase is not subject to VAT, because the seller is an individual or a business selling on an exempt basis, proportional registration tax applies (subject to specific cases): an individual purchasing a dwelling may request that it be calculated on the cadastral value rather than on the price, thanks to the “price-value” mechanism, and, if the property becomes their main residence, may benefit from the first-home reliefs. A company can use neither and pays on the actual price. Where, instead, the purchase is subject to VAT, as is the case when the seller is a construction or renovation company within five years of completion of the works, the tax on dwellings normally remains a definitive cost for the company as well, which cannot deduct it unless it is itself a construction company. The picture is reversed for instrumental properties, on which the company using them in its business can generally deduct the VAT where the transaction is subject to it, whether by obligation or by the seller’s option, without prejudice to proportional mortgage and cadastral taxes.

Management: residence, leasing and business activity

Moving from purchase to management, tax efficiency depends above all on the use of the asset. If the property is to be used as the residence of the person acquiring it, the individual is almost always the most straightforward solution: use of a company property by a shareholder entails costs that are non-deductible for the company and, in the absence of a market consideration, taxation of the differential benefit in the hands of the shareholder, as well as the risk that the company, lacking revenues proportionate to its assets, falls within the rules on non-operating companies.

The case of leasing is different. An individual may opt for the cedolare secca, a 21% substitute tax on rent, with a reduced rate for agreed-rent contracts, which does not allow costs to be deducted but ensures simplicity and a limited tax burden. A company, which cannot apply the optional cedolare secca regime, instead bears IRES at 24% and, as a rule, IRAP, without being able to deduct a large part of the costs of the apartments, and when profits are distributed, the individual shareholder pays a further 26% tax. For the leasing of a few dwellings, therefore, holding in one’s own name is often more efficient. Short-term rentals are different again: from 2026 an individual may manage these under the cedolare secca only up to two apartments, at a rate of 21% for one and 26% for the other; from the third onwards, a presumption of business activity applies, with an obligation to open a VAT number. In that case, an organised company may offer a more orderly solution, although the deductibility of the costs of residential properties used in that activity still leaves some uncertainty as to whether it is automatic.

Finally, when the property serves the entrepreneur’s business, as a head office, workshop or warehouse, the company shows its greatest advantage, because the property falls within the category of instrumental properties, allowing costs and depreciation to be deducted and VAT to be recovered.

Sale and the long term

The choice should be assessed not only by looking at short-term benefits, but also from the perspective of realisation. For an individual, the capital gain is not taxed if the sale takes place more than five years after the purchase, a period that becomes ten years from the end of the works for properties that have benefited from the Superbonus; nor is it taxed, even before that period, if the property was used, for the greater part of the holding period, as the main residence of the transferor or their family members, or if it was acquired by inheritance. For a company, by contrast, the capital gain is always business income and, from 2026, contributes in full to the income of the year in which it is realised, with no further possibility of spreading it over several years; if the proceeds are then to be distributed to the shareholder, tax on dividends is added.

Taking the property out of the company also has a cost, because assignment to the shareholder is treated as a sale at market value. The legislator has several times provided for favourable regimes for assignment and for conversion into a simple partnership (società semplice): the latest, introduced by the 2026 Budget Law, expired on 30 September 2026, and the 2027 Budget Bill, still under examination, proposes a new reopening until 30 September 2027. These are, however, temporary and uncertain windows, on which it is not prudent to base the initial choice.

From an asset-protection perspective, the company offers the concrete advantage of separating assets, since the shareholder’s personal creditors cannot directly attach the property, and the transfer of shares can facilitate generational succession where properties are numerous and there is more than one heir. It is, however, a protection not to be overstated, because a shareholder who gives personal guarantees to banks remains exposed and acts carried out solely to remove assets from creditors may be declared ineffective.

Which solution to choose

In light of the above, purchasing as an individual is normally preferable for a dwelling and for investment in one or a few apartments to be let, especially if they are to be held for a long time, benefiting from the capital gains exemption. A company becomes appropriate, instead, for instrumental properties used in the operating business, for substantial portfolios whose income is to be reinvested rather than distributed, for leasing carried out on a business basis, and also in the case of significant renovation operations, including by subdivision, with a view to resale. In intermediate cases, a numerical simulation is needed before the preliminary agreement, because correcting an unsuitable ownership structure after the event almost always costs more than a considered choice from the outset.