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Free calculator · 2026 rates
Italy Salary After Tax Calculator — 2026
Income tax
23–43%
Social
9.2%
Corp tax
24%
Dividends
26%
Currency
EUR
Country
Gross salary (€)
Period
2026 rates. Estimates only — not tax advice.
Italy Income Tax — How It Works
In Italy, a €40,000 gross salary results in approximately €27,320 take-home pay after IRPEF income tax and INPS social contributions in 2026. Italian IRPEF applies at three progressive rates: 23% on income up to €28,000, 35% from €28,001 to €50,000, and 43% above €50,000. Regional and municipal surcharges (addizionali) add an average 1.5%. Employees benefit from income tax credits (detrazioni da lavoro dipendente) that reduce tax liability, worth up to €1,880 at typical salary levels. Employee INPS contributions total 9.19% of gross, capped at approximately €119,650 per year. Dividends from Italian companies are taxed at a flat 26% substitute tax (ritenuta sostitutiva). Italy has introduced several flat-tax regimes: the forfettario regime allows self-employed individuals to pay just 15% (or 5% for new businesses) on income up to €85,000 — offering significant savings versus the standard IRPEF scale.
Example: €40,000 gross salary
Income Tax Brackets (Italy, 2026)
Italy Salary Tax — FAQ
How much tax is deducted from a €40,000 salary in Italy?
On €40,000 gross, Italian IRPEF is approximately €9,000 after work income credits, plus €3,680 in INPS social contributions. Net take-home is about €27,320 — an effective combined rate of 31.7%. Regional surcharges (addizionali) add another 1–3.3% depending on your region.
What is the forfettario flat-tax regime in Italy?
The regime forfettario allows Italian self-employed workers to pay a flat 15% substitutive tax (5% for the first 5 years of a new activity) on up to €85,000 of annual income. No VAT, no IRPEF, no regional taxes. INPS contributions still apply but are reduced. It is the most tax-efficient regime for freelancers and sole traders in Italy.
How are dividends taxed in Italy?
Dividends paid by Italian companies to individual shareholders are subject to a 26% flat substitute tax (ritenuta sostitutiva a titolo definitivo). This is withheld at source. Alternatively, dividends from qualifying participations (substantial shareholdings) are partially included in income and taxed at progressive rates.
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