This page helps you understand which taxes apply to you in Italy: as an employee, a self-employed person, a property owner, or someone with income or accounts in Ukraine. The figures are for the 2025 and 2026 tax years, with a reference to the legal provision. The rules are based on the texts of the laws; clarifications from the Italian tax agency (Agenzia delle Entrate) have not been added yet.
Who is considered an Italian tax resident?
Since 2024, you are a tax resident if, for most of the tax year, you have in Italy at least one of three things: your place of residence under the Civil Code, the place of your main personal and family ties (domicilio), or physical presence, counting partial days too. Anyone registered in a municipality’s population register (anagrafe) for most of the year is considered a resident unless they prove otherwise.
The law does not give a number of days, only “most of the tax period”. In this rule the law does not mention residence permits or temporary protection, so the general criteria apply to holders of protection.
What taxes does a resident pay?
A resident pays personal income tax (IRPEF) on all their income, wherever it was received, including in Ukraine. A non-resident pays it only on income received in Italy, for example on wages for work in Italy.
IRPEF rates:
| Annual income | 2025 | 2026 |
|---|---|---|
| up to €28,000 | 23% | 23% |
| from €28,000 to €50,000 | 35% | 33% |
| over €50,000 | 43% | 43% |
Regional and municipal surcharges are added on top. The regional surcharge has a basic rate of 1.23%; a region can raise it by no more than 2.1 percentage points or lower it, and from 12 August 2026 even to zero (D.Lgs. 68/2011, Art. 6). The municipal surcharge is set by the municipality, at no more than 0.8 percentage points; you pay it to the municipality where your tax address, the domicilio fiscale, was on 1 January (D.Lgs. 360/1998, Art. 1). Check the rates of your region and municipality on their websites.
For employees, the tax is reduced by the employee tax credit (detrazione per lavoro dipendente). With income of up to €15,000 it is €1,955 a year (in practice at least €690, and at least €1,380 on a fixed-term contract). For income from €15,000 to €50,000 it is calculated with the formula in the law, and at an income of €50,000 it falls to zero. With income from €25,000 to €35,000, another €65 is added. From 2026, with income over €200,000, the total of credits for expenses deducted at the 19% rate (except medical expenses) is reduced by €440.
Tax already paid abroad is credited against the Italian tax, but not beyond the share of the Italian tax that relates to the foreign income. You claim the credit in the return for the year the income belongs to, if the foreign tax was paid definitively before the return is filed.
How are wages taxed?
The employer withholds tax from each payment as an advance, taking the annual rates and credits into account; it applies credits for family members only if you declare that you are entitled to them (DPR 600/1973, Art. 23). The employer issues the certificate of income and tax withheld (Certificazione Unica, CU) by 16 March of the following year, or, if your job has ended, within 12 days of your request (DPR 322/1998, Art. 4).
In 2026, some payments to private-sector employees are taxed at a reduced rate, unless the employee has refused in writing:
- pay rises under collective agreements renewed from 2024 to 2026: 5%, if your employment income in 2025 did not exceed €33,000;
- extra pay for night work, work on public holidays and days off, and shift work: 15% within €1,500 a year, if your employment income in 2025 did not exceed €40,000.
What about income and property in Ukraine?
A resident of Italy declares Ukrainian income here as well, and tax paid in Ukraine is credited under the rules of the convention and Italian law. The convention between Italy and Ukraine for the avoidance of double taxation was signed in Kyiv on 26 February 1997, has been in force since 25 February 2003, and applies to income from 1 January 1995. If the texts differ, the English text prevails.
The main rules of the convention:
| Income | Where it is taxed |
|---|---|
| Wages | In the country where you are resident; if the work is done in the other country, that country may also tax the wages. It does not tax them if you were there for no more than 183 days in 12 months, the employer is not its resident, and the costs are not borne by the employer's permanent establishment there |
| Business profits | In the other country only if there is a permanent establishment there |
| Independent professional services | In the other country only if there is a fixed base for the work there |
| Rent and sale of real estate | May be taxed in the country where the property is located |
| Dividends | The source country withholds no more than 5% (if the recipient is a company with a stake of 20% or more) or 15% in other cases |
| Interest | The source country withholds no more than 10% |
| Royalties | The source country withholds no more than 7% |
| Pensions | Pensions for past employment are taxed only in the country of residence. Payments from a state pension fund of the social security system are taxed only in the country that pays them, but the protocol clarifies that this refers to non-contributory payments |
An employment pension from the Pension Fund of Ukraine (PFU) is built from contributions, so it is doubtful whether it falls under the “only in Ukraine” rule. There is no official clarification, so we do not give a final answer; more on the page Pension in Italy for Ukrainians.
If a person is considered a resident under the laws of both countries, the convention decides the country by permanent home, then by the center of vital interests, the place where the person usually stays, and citizenship, and if that does not help either, by agreement between the tax authorities.
Italy removes double taxation by a credit: it deducts the tax paid in Ukraine, but not more than the share of Italian tax on that income. There is no credit if, at your request, the income was taxed in Italy by a final withholding.
Accounts and property abroad
- Section RW of the return. A resident reports investments, financial assets and crypto-assets abroad in the tax return. Accounts abroad do not have to be reported if the highest total balance on them during the year did not exceed €15,000 (DL 167/1990, Art. 4).
- Tax on foreign financial assets (IVAFE). 2 per mille of the value; for current and savings accounts, a fixed amount, like stamp duty: €34.20 a year for an individual.
- Tax on property abroad (IVIE). 1.06% of the value; it is not paid if the amount does not exceed €200. Your main home is exempt, except luxury categories, for which the rate is 0.4%.
If you kept your Ukrainian sole trader business (FOP) after moving, read our separate article.
What does a self-employed person pay?
A self-employed person (lavoro autonomo) registers for VAT (IVA) and gets a VAT number (partita IVA) at a local office of the tax agency within 30 days of starting the activity (DPR 633/1972, Art. 35) and pays contributions to INPS.
Flat-rate scheme (regime forfettario)
- Who can use it: revenue (ricavi or compensi) of no more than €85,000 a year and staff costs of no more than €20,000.
- Tax: 15% of revenue multiplied by the profitability coefficient for your type of activity, instead of IRPEF, the surcharges and the regional tax on productive activities (IRAP). Mandatory INPS contributions are deducted.
- 5% instead of 15%: in the year you start and the four following years, if in the three years before that you did not carry on a business or professional activity and the new activity does not continue your previous work.
- Who cannot use it:
- non-residents (except residents of the EU and EEA who earn at least 75% of their income in Italy), so a resident of Ukraine cannot use the scheme;
- people who work mainly for their current employer, or for someone who employed them in the previous two years, or for companies connected with them;
- people whose employment income in the previous year exceeded €35,000 (the threshold for 2025 and 2026; without this rule it is €30,000), unless that employment has ended.
- Leaving the scheme: the scheme ends from the following year if the conditions are no longer met, and immediately if revenue exceeds €100,000.
- Under the scheme, VAT is not charged, and clients do not withhold tax from you.
INPS contributions in 2026
| Who | Rate | Key amounts |
|---|---|---|
| Professionals without their own professional fund (the separate INPS fund, Gestione separata) | 26.07%; 24% if you are already a pensioner or insured in another fund | Contributions are calculated on income up to €122,295; a full year of contributions requires income of €18,808 |
| Artisans (artigiani) | 24% on income up to €56,224, 25% above that amount | Minimum contribution of €4,521.36 a year on income of €18,808 |
| Traders (commercianti) | 24.48% on income up to €56,224, 25.48% above that amount | Minimum contribution of €4,611.64 a year on income of €18,808 |
The minimum contributions of artisans and traders for 2026 are paid on 18 May, 20 August, 16 November 2026 and 16 February 2027, and the rest together with income tax, all with the F24 payment form. According to the INPS circular, artisans and traders under the flat-rate scheme can pay contributions reduced by 35% if they applied for this in time; for those who registered for the first time in 2025, a 50% reduction is provided.
What does a property owner in Italy pay?
An owner pays the municipal property tax (IMU); a main home is exempt from it, except luxury categories. A main home is one where the owner and their family live permanently and are registered. The basic rate for other property is 0.86%; the municipality can raise it to 1.06% or lower it to zero. It is paid in two installments: by 16 June and by 16 December (Law 160/2019, Art. 1). Tenants do not pay IMU.
What other taxes might you come across?
VAT is 22%; reduced rates of 4, 5 and 10% apply to goods and services on a separate list (DPR 633/1972, Art. 16).
What will change from 2027?
The laws will change, but not the rates: from 1 January 2027, the income tax law (TUIR) and the VAT law will be replaced by new codes (D.Lgs. 117/2026 and D.Lgs. 10/2026). The residency rule, the IRPEF rates of 23, 33 and 43% and the VAT rate of 22% are the same in them, but the article numbers will change.
That is why, on the Normattiva website, the TUIR articles in force today and the rules of the flat-rate scheme and of the taxes on assets abroad are already marked “ABROGATO” (repealed): this is how the system shows the repeal that will take effect on 1 January 2027. We link to the versions in force in 2026.
What mistakes should you avoid?
- Thinking that temporary protection by itself makes you a tax resident or exempts you from taxes: the general criteria apply.
- Not declaring Ukrainian income after becoming a resident of Italy.
- Forgetting section RW if the highest balance on your accounts abroad during the year exceeded €15,000.
- Counting on the flat-rate scheme while being a tax resident of Ukraine or working mainly for a former employer.
- Mixing up the rates: for 2025 the second rate is 35%, for 2026 it is 33%.
What has not yet been officially confirmed?
Several questions have not yet been officially clarified, and clarifications from the tax agency have not been added yet:
- how the tax agency counts days for residency;
- whether accounts abroad with an average balance of up to €5,000 are exempt from IVAFE;
- how a pension from the Pension Fund of Ukraine is taxed in Italy;
- whether activity in Ukraine counts as “previous activity” that rules out the 5% rate under the flat-rate scheme;
- how long the 50% reduction in contributions lasts for those who registered for the first time in 2025;
- whether the 2027 budget will change the rates: we have not checked it yet.
We will update this page as soon as clarifications appear.