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Italy
Italy has both a corporate income tax (imposta sul reddito sulle società, or IRES) and a regional production tax (imposta regionale sulle attività produttive, or IRAP). The average combined tax is just under 30 percent.
| Taxable income (EUR) | Tax rate |
|---|---|
| All income (IRES) | 24% |
| All income (IRAP) | 3.9% |
Employees in Italy pay both income tax (which is withheld and remitted by the employer) and payroll tax. The average employee payroll contribution tax rate in Italy is 10%. Income tax is an additional tax and it depended on how much the employee makes yearly.
The breakdown of income tax based on income is as follows:
| Taxable Income (EUR) | Tax rate 2023 |
|---|---|
| Up to 15,000 EUR | 23% |
| 15,000 – 28,000 EUR | 25% |
| 28,000 – 50,000 EUR | 35% |
| Over 50,000 EUR | 43% |
Employers in Italy contribute to many social security benefits for employees. This is similar to what is known as ‘payroll tax‘ in the United States. The below social security programs are covered in Italy for all employees:
| Contribution item | Contribution rate |
|---|---|
| National Pension Scheme | 10% |
| Other Contributions | 20% |
Employees contribute to the same above-mentioned social security programs as their employers.
| Contribution item | Contribution rate |
|---|---|
| National Pension Scheme | 3.3% |
| Other Contributions | 6.6% |
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The Italy Tax Administration is a branch of the Ministry of Finance. The National Institute for Social Security (INPS) is the bureau in Italy that handles social security contributions.
Yes. Employer’s in Italy contribute to many social security benefits for its employees. The below social securities are covered in Italy for all employees:
Each paycheck the employer must withhold roughly 10% of the employee’s salary to contribute to national social security benefits. In addition, the employer needs to contribute 30% of the employee’s salary to the same social security benefits.
Italy – 2023 CIT tax rates
