INPS - Social Security Contributions — Italy
INPS (Istituto Nazionale della Previdenza Sociale) is Italy's National Social Security Institute managing pensions, healthcare, unemployment benefits, maternity/paternity leave, and disability benefits. Contributions are mandatory for all workers and fund Italy's comprehensive welfare system.
INPS - Social Security Contributions
INPS (Istituto Nazionale della Previdenza Sociale) is Italy's National Social Security Institute managing pensions, healthcare, unemployment benefits, maternity/paternity leave, and disability benefits. Contributions are mandatory for all workers and fund Italy's comprehensive welfare system.
Employee Contributions (INPS)
Applied to gross salary up to annual threshold of €55,448 (2025, 2026 threshold to be confirmed). Automatically withheld by employer from monthly paycheck.
Applied to salary portion exceeding €55,448 up to maximum cap of approximately €120,000. Only 1% additional rate on higher earnings.
For employees registered post-1996, contributions cap at ~€120,000 (2025, exact 2026 figure pending). Income above this pays only minor contributions (~5% by employer). Executives have different caps.
Commercial executives pay same rates plus additional funds: Fondo Mario Negri (2% from 2026), FASI (€1,120 flat), PREVINDAI (2% up to €200k). Total burden significantly higher for executives.
Employer Contributions
Employers pay 27-32% of gross salary on top of wages (not deducted from employee). Exact rate varies by: industry sector, company size, collective bargaining agreement (CCNL), employee classification. Average around 30%.
Includes: retirement pension (largest portion), unemployment fund (NASpI), maternity/paternity fund, sickness fund, family allowances, solidarity contributions, workplace accident insurance (INAIL separate).
Employer's total cost: 100% gross salary + 30% INPS + ~7.5% TFR (severance) = approximately 138% of gross salary. Italy has one of Europe's highest employment costs.
Self-Employed Contributions
For self-employed without VAT number or not in professional orders: 24% if enrolled in other schemes, 26.07% with VAT exclusive enrollment, 33.72-35.03% all others. Applied to business income up to ~€120,000 cap.
Enrolled in IVS scheme pay ~24% on business income plus mandatory minimum contribution of €4,515 annually (2025) regardless of income. Additional 1% on income over €55,008.
Lawyers, accountants, engineers, doctors have separate professional pension funds (Casse Professionali) with own rates (typically 10-20%) instead of INPS.
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IRPEF - Personal Income Tax 2026
IRPEF (Imposta sul Reddito delle Persone Fisiche) is Italy's national personal income tax with three progressive brackets as of 2026. Regional and municipal surcharges add additional layers, making total tax burden location-dependent.
03Tax Credits & Deductions (Detrazioni e Deduzioni)
Italy distinguishes between deductions (oneri deducibili - reduce taxable income) and tax credits (detrazioni - reduce tax owed). Credits are more valuable as they provide euro-for-euro reduction regardless of tax bracket.
04How Your Tax is Calculated in Italy
Italian tax calculation involves multiple layers: national IRPEF (23-43%), regional surcharge (0.7-3.33%), municipal surcharge (0-0.9%), plus social security contributions (9.19-10.19%). Understanding the process helps optimize your tax position and avoid surprises.
05Capital Income & Investment Taxation
Italy applies flat-rate substitute tax (imposta sostitutiva) to most capital income instead of progressive IRPEF rates. This includes dividends, interest, capital gains from securities and crypto. Separate rules apply for different asset types.
06Impatriate Workers Tax Regime (Lavoratori Impatriati)
Italy's Impatriate Worker Regime (updated 2024) provides significant tax relief for qualified workers relocating to Italy from abroad. The regime aims to attract highly skilled professionals, encourage Italian citizens to return, and boost Italy's competitiveness for international talent.
07HNWI Flat Tax Regime for New Residents
Italy's High Net Worth Individual (HNWI) flat-tax regime allows new residents to pay a fixed annual lump sum on all foreign-source income regardless of amount. Designed to attract wealthy individuals, investors, and entrepreneurs to relocate to Italy.