Leasing advertising space in a condominium: contract and fee

A condominium can grant an advertising agency the use of a common part, typically the facade, the flat roof or the sheet covering scaffolding during works, in exchange for a fee. This is income from the common good and belongs to all the owners in proportion to their thousandths (millesimi). The grant must be approved by the owners' meeting, formalised in a written contract and, for tax purposes, the fee must be declared pro rata by the individual co-owners. Here is how to structure the operation safely.

Which spaces can be leased for advertising

The spaces that are typically monetised are highly visible common surfaces: the street-facing facade, the blind side wall, the flat roof for a totem or a board, and above all the site sheet that covers the scaffolding during facade renovation. The latter is the most frequent and profitable opportunity, because the temporary banner covers the scaffolding for months in busy locations. In every case the requirement is that it is a common part under Article 1117 of the Italian Civil Code and that the advertising use does not harm the architectural decorum or the enjoyment of the other owners.

Lease or concession: the nature of the contract

It is not always a genuine lease. When the agency obtains only the right to place a banner on a surface, without exclusive use of the property, the relationship is a concession of the space, that is an obligation to permit. When, on the other hand, a registered asset is granted for enjoyment, for example a room or a structured portion, it falls under a proper lease. The distinction is not merely formal: it affects the tax treatment of the income and the maximum freely agreed duration. The contract must state the object, the surface, the duration, the fee, payment terms, restoration obligations and liability for damage.

The majorities required at the meeting

Granting a common part for advertising is an act of managing the collective asset and falls within the powers of the owners' meeting. For contracts of no more than nine years, the simple majority under Article 1136, second paragraph, of the Italian Civil Code is sufficient, that is a majority of those present representing at least half the value of the building at the second call. The situation is different when the contract exceeds nine years: an ultra-nine-year lease is an act exceeding ordinary administration and requires unanimous consent, following the principles of Article 1108 recalled by Article 1139. Caution is also needed when the banner permanently affects the architectural decorum: in that case the resolution must be carefully reasoned.

How the fee is split among the owners

The fee collected is income from the common good and must be divided among all the owners in proportion to their thousandths, under the general criterion of Article 1123 of the Italian Civil Code, unless the regulation or a unanimous resolution sets a different criterion. The administrator records the income in the condominium accounts and, in the annual report, uses it to reduce common expenses or distributes it by crediting the individual owners. Good practice is:

• record the contract and the fee invoices or receipts in the accounting register
• state transparently in the report the amount collected and how it is used
• prepare a statement per owner with the share of income due, useful for the tax return
• check any municipal advertising tax or single asset fee payable by the operator

Taxation of advertising income

The condominium is not a separate taxpayer for this income: a transparency principle applies whereby the income is taxed in the hands of each owner in proportion to their share. If the fee derives from the concession of the space as an obligation to permit, the individual declares it as miscellaneous income, in the dedicated line of the personal income tax return or in section D of the 730 form. If instead it is the lease of a registered common property, the fee is building income and follows the rules of the property section. The administrator must give each owner the statement of their share of income collected during the year, because it is the individual, not the condominium, who reports it on the return.

Mistakes to avoid

The first mistake is to collect the fee without a resolution authorising the contract: an administrator acting alone is exposed to challenges and liability. The second is keeping the income in a sort of hidden fund or offsetting it without a trace: every euro must pass through the condominium bank account and appear in the report. The third is forgetting the tax notice to owners, which exposes them to errors on their return. Finally, always check that the banner complies with municipal rules on signs and advertising and does not breach landscape constraints on protected buildings.

Managing an advertising contract means keeping the resolution, the accounts and the tax obligations together without losing pieces. With management software such as AmministraPro, the administrator records the extraordinary income, links it to the report and automatically generates the pro rata statement for each owner, reducing the risk of omissions. The features are described on the /funzioni page, while plans for firms of every size are on /prezzi.