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Income tax in Italy 2026
You pay Italian income tax on three national bands — 23% to €28,000, 33% to €50,000, then 43% — plus a regional surcharge of 1.23%–3.33% and a municipal one of up to 0.9%.
There is no personal allowance; instead a system of tax credits does the work, and the employment credit of up to €1,955 means salaries up to about €8,500 pay nothing.
Newcomer regimes can transform the bill: inbound workers tax only half their salary, and small-scale freelancers can settle at a flat 15% or even 5%.
At a glance
- top rate
- 43% above €50,000 (+ regional and municipal surcharges)
- entry band
- 23% on the first €28,000
- tax year basis
- Calendar year
- filing deadline
- 2 November 2026 online (statutory 31 October); balance due 30 June, advances 30 June and 30 November
- residency basis
- Residents taxed on worldwide income
- regime flag
- 50% inbound-worker exemption on income up to €600,000
Rates
National income tax bands (2026)
| Band (EUR) | Rate on this band | Note |
|---|---|---|
| 0 – 28,000 | 23% | Credits erase the tax on low salaries and pensions |
| 28,001 – 50,000 | 33% | Cut from 35% in 2026 |
| Over 50,000 | 43% | Regional and municipal surcharges come on top |
Marginal rates apply within each band.
Thresholds & allowances
- Employment tax creditUp to €1,955 for salaries up to €15,000, tapering away by €50,000
Creates a no-tax zone up to roughly €8,500 of salary; pensioners get a parallel credit
- Extra earned-income credit€1,000 for salaries between €20,000 and €32,000
Phases out completely at €40,000
- Family creditsUp to €950 per child aged 21–29 and €750 per other dependant, income-scaled
A dependant must earn under €2,840.51 (€4,000 for children up to 24); under-21 children are covered by a separate universal allowance
- Tax-free fringe benefits€1,000 a year (€2,000 with dependent children) through 2027
Can include employer payments for utilities, rent or mortgage interest on a first home
- Flat-rate scheme ceiling€85,000 of annual receipts
The scheme dies immediately if receipts pass €100,000
Surcharges
- Regional surcharge1.23% – 3.33%over All taxable income, rate set by your region
- Municipal surchargeUp to 0.9%over All taxable income, rate set by your municipality
Residency
Residency trigger
You are tax resident if, for more than half the year (183 days, counting part-days), you live in Italy, have your family and personal life centred there, or are simply physically present. Being on the resident population register is now only a starting presumption you can rebut with evidence. Italians who move to a listed low-tax jurisdiction are presumed still resident unless they prove otherwise.
Non-resident treatment
Non-residents pay Italian tax only on Italian income. If you live in a country that exchanges tax information with Italy and earn 75%+ of your total income from Italian sources, you can claim the same credits residents get.
Notes
- There are no personal allowances in the Italian system — everything works through tax credits, which shrink as income rises.
- Above €75,000 of income, most 19% expense credits are squeezed by a family-size-based cap, and above €200,000 a further €440 is cut.
- Renting out a home? You can opt out of the income tax bands into a flat 21% substitute tax on residential rents (10% for capped-rent contracts in designated areas); short lets of under 30 days pay 26%, or 21% for one property you nominate.
- Severance and other end-of-employment payouts are taxed separately at your historical average rate rather than stacked on top of your final-year income.
- You make two advance payments (30 June and 30 November) based on last year's tax, and settle any balance the following 30 June.
- A pre-filled return appears online by 30 April each year — accept it unchanged and refunds flow without further checks.
FAQ
What is the top income tax rate in Italy?
43% nationally, on income above €50,000 — but regional and municipal surcharges add roughly 2–4 points, so the real top marginal rate is about 45–47%.
How much can I earn tax-free in Italy?
Roughly €8,500 as an employee — the €1,955 employment credit cancels the 23% tax on income up to about that level. Pensioners have a similar shield.
What is Italy's inbound-worker tax break?
Qualifying skilled workers who move their tax residence to Italy pay tax on only 50% of employment or professional income up to €600,000, for 5 years — 40% taxable with a dependent child. You must not have been Italian-resident in the previous 3 years and must commit to staying 4.
When is the Italian tax return due?
End of October of the following year for the standard online return — 2 November 2026 this season, since 31 October falls on a Saturday; employees and pensioners using the pre-filled version can file by 30 September.
Figures: tax year 2026, compiled from public sources. Not tax advice.