Taxes in Italy: The Basics

Taxes are rarely a favorite topic—but if you’re moving to Italy, you should know the basics. When do you actually become liable for taxes? How much is the income tax? And how does filing a tax return work? This overview explains the Italian tax system for individuals in an easy-to-understand way—without all the tax jargon.

When You Are Taxable in Italy

Your tax residency is the key factor. As tax resident You qualify if you spend most of the year—that is, at least 183 days – live in Italy, where you Residenza or if your life is centered in Italy.

The result: As a tax resident, Italy taxes your global income. If you are not a resident, you only pay taxes on income from Italian sources.

IRPEF: Income Tax

The most important tax for individuals is the IRPEF (Individual Income Tax). It is structured on a progressive scale. For 2026, there are three tiers:

• 23 % up to 28,000 €
• 33 % from €28,001 to €50,000
• 43 % over 50,000 €

Note: Tax rates and brackets may change with the annual budget law—check the current rates before making any important decisions.

Regional and Municipal Surcharges

In addition to IRPEF, there are two surcharges (additional): a regional surcharge (roughly 1.2–3.3 %, depending on the region) and a municipal surcharge (usually up to about 0.9 %). So how high they turn out to be depends on where you live.

The Tax Return: Form 730 or Modello Redditi PF

There are two main forms:

• Modello 730: For employees and retirees. It’s convenient because the tax office pre-fills much of the information, and the tax is withheld through payroll (usually July–September).
• PF Income Form: For self-employed individuals and anyone who cannot file Form 730. Payment is usually made in June of the following year.

A partial pre-filled form (pre-filled tax return) is made available online by the Agenzia delle Entrate—access via SPID, CIE, or CNS. You can find all the details about forms and deadlines in the guide Tax Return in Italy.

Other Important Taxes

• IVA (Value-Added Tax): particularly relevant for self-employed individuals with VAT Number.
• IMU: Property tax on real estate (generally not on the owner-occupied primary residence).
• Stamp Duty: including €34.20 per year on bank accounts with an average balance of €5,000 or more.
• RAI License Fee: Broadcasting fee, usually included in the electricity bill.

Special Tax Regimes

Italy is actively courting new residents and offering attractive special incentives:

• Flat-Rate Scheme: Flat-rate tax for the self-employed (15 %, often 5 % in the first few years).
• Impatriate System: Significant tax exemption on income earned in Italy for qualified newcomers.
• 7 % Flat Rate for Retirees: for foreign pensions when moving to small towns in southern Italy.

These programs have their own requirements and deadlines—we cover them in detail in separate guides.

Avoiding Double Taxation

To make sure you don't pay twice, there is Double Taxation Agreement (e.g.,. Germany–Italy). These rules determine which country is authorized to tax which income and take into account taxes already paid. If you have income from multiple countries, it’s worth seeking professional advice.

Get help: Commercialista or CAF

For simple cases (employment, retirement), a CAF (Tax Assistance Center) or the pre-filled Form 730. If you are self-employed or have income from abroad, you need a Accountant (Tax advisor) makes sense—it helps prevent mistakes and often saves money.

What You Need to Do Next

The foundation for all tax matters is your Tax ID number. Also, determine your tax residency early on, look into applicable special tax regimes, and—if necessary—find a commercialista in plenty of time.