Income Tax Rates

Rates and credits

Italian income tax is levied at the following rates on taxable income:

Income Tax Rates

Taxable Income (€)

Tax Rate (%)

Up to 10,329.14

18

10,329.14 – 15,493.71

24

15,493.71 – 30,987.41

32

30,987.41 – 69,721.68

39

Over 69,721.68

45

In addition to the above state tax, regional tax is payable at between 0.9 and 1.4 per cent, depending on the region, and municipal tax at up to 0.5 per cent.

Credits

Personal allowances are granted in the form of tax credits, which are deducted from the amount of tax to be paid. Since 2002 the credits for employees (known officially as dependent workers), the self-employed (referred to as independent workers) and pensioners have been different. In the case of couples, one spouse’s tax credit may be used to offset tax payable by the other spouse. There’s also a tax credit of €303.68 for the first dependent child under 18 and €336 for subsequent children, if household income is below €51,645.69.

Taxable Income (€)

Tax Rate (%)

Up to 10,329.14

18

10,329.14 – 15,493.71

24

15,493.71 – 30,987.41

32

30,987.41 – 69,721.68

39

Over 69,721.68

45

In addition to the above state tax, regional tax is payable at between 0.9 and 1.4 per cent, depending on the region, and municipal tax at up to 0.5 per cent.

Credits

Personal allowances are granted in the form of tax credits, which are deducted from the amount of tax to be paid. Since 2002 the credits for employees (known officially as dependent workers), the self-employed (referred to as independent workers) and pensioners have been different. In the case of couples, one spouse’s tax credit may be used to offset tax payable by the other spouse. There’s also a tax credit of €303.68 for the first dependent child under 18 and €336 for subsequent children, if household income is below €51,645.69.

This article is an extract from Living and Working in Italy from Survival Books.

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Other comments

  • Pat X., 31 July 2008 Reply

    Date/source?

    When was this information collected? This other web site, dated March 2008, shows much different tax rates and brackets: http://www.worldwide-tax.com/italy/italy_tax.asp