Flat Tax vs Ordinary Regime for Short-Term Rentals in Puglia

What is cedolare secca?

Cedolare secca is an optional flat tax regime introduced in Italy in 2011. It allows landlords to pay a fixed percentage on rental income instead of progressive IRPEF rates. For short-term rentals (contratti di locazione breve, up to 30 days), the flat rate was 21% until 2023. However, the 2024 Budget Law (Legge di Bilancio 2024) raised the rate to 26% for all short-term rentals, except for the first apartment, which remains at 21%. This change applies from 2024 onwards.

How does cedolare secca work for short-term rentals?

• You pay a flat rate on gross rental income (before expenses).
• For 2024 and beyond: 21% for the first apartment, 26% for additional apartments.
• No IRPEF, addizionali, or stamp duty on the rental contract.
• You must still collect and pay tourist tax (tassa di soggiorno) separately.
• You can choose cedolare secca for each property independently.

What are the advantages of cedolare secca?

• Simplicity: No need to track expenses; tax is a fixed percentage of gross income.
• Certainty: You know exactly how much tax you'll pay.
• No IRPEF: Rental income doesn't push you into higher tax brackets.
• No stamp duty: The rental contract is exempt from registration tax.

What are the disadvantages?

• No expense deduction: You can't deduct maintenance, utilities, or management fees.
• Higher rate for multiple properties: From 2025, the 26% rate applies to all short-term rentals beyond the first.
• Not always optimal: If your expenses are high, the ordinary regime may result in lower taxable income.

What is the ordinary regime?

Under the ordinary regime, rental income is added to your total income and taxed at progressive IRPEF rates (23% to 43%). However, you can deduct actual expenses related to the property, such as maintenance, utilities, property management fees, and depreciation. This can significantly reduce your taxable income.

How does the ordinary regime work?

• Rental income is combined with other income (salary, pensions, etc.).
• You can deduct 5% of gross rent as a flat deduction, or opt for the "cedolare secca" if eligible.
• Alternatively, you can deduct actual expenses if you keep proper records.
• Tax rates: 23% up to €15,000, 25% up to €28,000, 35% up to €50,000, 43% above.
• You also pay addizionali regionali and comunali.

When is the ordinary regime better?

• If you have significant deductible expenses (e.g., renovations, high management fees).
• If your total income is low and you fall into the 23% bracket.
• If you want to offset rental losses against other income.
• If you rent to long-term tenants (over 30 days) and the flat tax doesn't apply.

How much can you earn on Airbnb in Puglia?

According to 2024 data from AirDNA, the average daily rate (ADR) in Puglia for a 2-bedroom apartment is €120 in high season (July–August), with occupancy rates around 75%. In Ostuni, a trullo can command €250 per night, while a masseria with pool in Valle d'Itria can fetch €600. Annual gross revenue for a well-managed property ranges from €20,000 for a small apartment in Bari to €80,000 for a luxury villa in Polignano a Mare.

*Source: Timeless Puglia internal data, 2025.*

How to calculate taxes under cedolare secca vs ordinary regime?

Let's compare a typical 2-bedroom apartment in Monopoli with €35,000 annual gross rental income.

Cedolare secca (26% for short-term rentals):

• Tax: €35,000 x 26% = €9,100
• Net income: €25,900

Ordinary regime:

Assume deductible expenses: management fees €5,000, utilities €3,000, maintenance €2,000, insurance €500, tourist tax €1,000 (not deductible). Total deductible: €10,500.

• Taxable income: €35,000 - €10,500 = €24,500
• IRPEF (assuming other income puts you in 35% bracket): €24,500 x 35% = €8,575
• Addizionali (approx. 3%): €735
• Total tax: €9,310
• Net income: €25,690

In this case, cedolare secca saves €210. However, if you have higher expenses or are in a lower tax bracket, the ordinary regime could be better.

What about the 5% flat deduction?

Under the ordinary regime, you can opt for a 5% flat deduction on gross rent instead of itemizing expenses. This is rarely beneficial for short-term rentals with high costs.

What are the compliance requirements for short-term rentals in Puglia?

All short-term rental owners must obtain a CIN (Codice Identificativo Nazionale) from the Ministry of Tourism. This code must be displayed on all listings. Additionally, you need a SCIA (Segnalazione Certificata di Inizio Attività) to the local municipality. From 2024, the CIN is mandatory for all properties, including those managed via Airbnb and Booking.com. Failure to comply can result in fines up to €5,000.

What is the CIN code?

The CIN is a unique identifier for short-term rental properties. It ensures traceability and tax compliance. You can apply for it online through the Ministry of Tourism's portal. Timeless Puglia handles the entire CIN application process for its owners.

How does tourist tax work?

Each municipality sets its own tourist tax (tassa di soggiorno), typically €1–€5 per person per night. In Ostuni, it's €2 per person per night for the first 7 nights; in Bari, €2.50. You must collect it from guests and remit it to the comune.