How does the Italian tax system work?

What is the Codice Fiscale?

The codice fiscale is the basic means of identifying the individual in his relations with the state and public bodies. The only valid codice fiscale is that issued by the Agenzia delle Entrate . No other external body is authorised to issue such a code.

If you don't possess such a code, you will have to go to the local office of the Agenzia delle Entrate with a suitable means of identification, which for foreigners means a passport or permesso di soggiorno (residence permit). For newly born children a birth certificate or written declaration by the parents is sufficient.

Apart from the local office of the Agenzia delle Entrate, the code can be issued by Town Halls (for newly born children within 60 days from the date of birth) and by Consulates (for those resident abroad), as long as they are connected telematically to the Anagrafe Tributaria.

How does the Italian tax system work?

IVA (VAT) in Italy

The rate of value added tax (Imposta sul Valore Aggiunto - IVA) is 21%.

For further information contact any customs and excise office in the UK or, if you are in Italy, your local Ufficio Provinciale Imposta sul Valore Aggiunto.

IRPEF (Income Tax)

Income tax (Imposta sul Reddito delle Persone Fisiche - IRPEF) is generally deducted at source from salaried workers. This is not the case with self-employed workers.

When you start working you will need a tax number (codice fiscale, see Residency and entry requirements). You must contact your local tax office (Agenzia delle Entrate) to obtain this.

Discuss your tax position with your employer fully before accepting a job to establish how much tax and national insurance will be deducted at source. To avoid double taxation when more than one country has taxation rights on the same income, the UK has double taxation agreement (PDF, 57 KB) with many countries including Italy. Alternatively contact HM Revenue & Customs.

For further information once in Italy, contact your local office that deals with direct taxes (Agenzia delle Entrate). All local tax offices are listed in the telephone directory under "Uffici Finanziari"; more information can be found at the following internet site: Ministero delle Finanze (Italian Treasury - in Italian).