Regime Forfettario: Who Qualifies and What You Get
Learn how the Regime Forfettario tax system works for freelancers in Italy, including tax rates and important revenue limits.
The Regime Forfettario is a simplified tax system designed for freelancers and small business owners in Italy.
Who it's for
This scheme is available to freelancers who earn a specific amount of annual revenue. To qualify, your total yearly revenue must remain under the threshold of €85,000.
What you get
The main benefit is a simplified tax structure based on a flat rate applied to your taxable income. This rate is set at 15%, but if you are starting a new activity, you may qualify for a significantly lower rate of 5% for your first five years.
What it costs you
There are specific trade-offs to this simplified system. While you benefit from a lower tax rate and do not need to add VAT to your invoices, you lose the ability to deduct your business expenses. This means you cannot subtract the cost of your professional tools or services from your total income when calculating your taxes.
The catch to know
The most important thing to remember is that you must strictly monitor your revenue. Because the scheme is based on your total earnings, exceeding the allowed revenue limit will trigger an immediate exit from the regime, moving you into a different tax category.
How to apply
- Confirm that your projected annual revenue stays below the legal limit.
- Set up your Partita IVA to register your professional activity.
- Select the simplified tax regime option during your registration process.
- Manage your finances carefully to ensure you do not accidentally exceed the revenue ceiling.
For more details, visit the official portal: https://www.agenziaentrate.gov.it