Tax Wedge Reduction: Who Qualifies and What You Get
Learn how the Tax Wedge Reduction increases your net pay by lowering social security contributions for eligible employees in Italy.
The Tax Wedge Reduction is a measure designed to increase your take-home pay by lowering the amount of social security contributions deducted from your salary.
Who it's for
This scheme is available to employees whose income falls below certain specific thresholds.
What you get
You receive a higher net salary in your paycheck. This happens because the social security contributions required from the employee are reduced, meaning more money from your gross pay stays in your pocket.
What it costs you
There is no direct cost to you. The reduction is handled through your payroll processing, so the calculation is done automatically by your employer.
The catch to know
The income limits required to qualify for this reduction are not permanent. These thresholds change every year based on updates to the national budget law.
How to apply
- Review your payslip (busta paga) to see your earnings.
- Check if your income level falls within the current annual thresholds.
- Confirm with your employer that the reduction is being applied automatically in your payroll.