English 
Italian 
French 
Danish Table of Contents
Introduction to Expatax and IBAN Discrimination
"Do I need an Italian bank account to make a deposit on a property?". "The notary wants 500 euro (we've heard as much as 1000 euro) to keep my property purchase funds in escrow". We hear questions like these all the time and, to be honest with you, they make us very upset.
At Expatax, we are on a mission to make tax matters easier to understand for expats and retirees. In line with this ethos, we bring you important information on the subject of IBAN discrimination, particularly prevalent among those seeking properties in Italy. We invite you to further explore the topic using our TAX AI at the end of the article for any additional queries.
It Is Illegal To Force You To Use Italian Bank Accounts for Property Transactions
Entering the Italian property market, you may find yourself literally forced by a real estate agent or by a notary to have an Italian bank account in order to transfer money for a property purchase or a deposit on a rental property. Contrary to frequent misconceptions, you have a friend in European legislation, which explicitly forbids any payment to have to be from an account specific based in a specific European Member State. In other words, no one can force you to use an Italian bank account to pay anything, be it a property, an electricity bill. You are free to use any account based in the EU/EEA, including free accounts such as Wise and Revolut.
What is "IBAN Discrimination"?
An IBAN (short for International Bank Account Number) is a unique identifier for a bank account, which includes both its country, the name of the bank, and the actual account number at that bank. "IBAN discrimination" occurs when anyone, despite holding a bank account in any EU Member State, is requested to use a different account to pay.
IBAN discrimination happens, for instance, when a notary or a real estate agent asks you to draw a bank draft (called "assegno circolare" in Italian), which you can only do from an Italian account. Alternatively, you are asked outrageous fees by the notary for them to hold your funds and forward them to the seller (500 to 1000 euro per transaction is not unheard of). Understand that a bank transfer costs on average 0 to 2 euro - therefore the notary is putting a 200x margin on that payment!
IBAN discrimination also happens when an Italian company or employer insists on accepting only an Italian IBAN for a direct debit or credit transfer.
How Can I Report IBAN Discrimination?
The European Commission encourages consumers to raise a complaint regarding any occurrence of IBAN discrimination with the competent authority in the relevant country. They offer a user-friendly feedback form, taking merely two minutes of your time, where you can report details of what you have been going through.
If it happens to you, the mere mention to the notary or other professional of Article 9 of the SEPA regulation will go a long way.
- Inform them that they are required to accept IBANs from other SEPA countries (Article 9 of the SEPA Regulation).
- If necessary, submit a formal written complaint.
- If your complaint does not receive a satisfactory answer, you can report the alleged violation to the appropriate competent authority (you can use the link above).
