What is TFR in Italy?

TFR (trattamento di fine rapporto) is a deferred severance the employer sets aside every year, about 7.41% of gross pay. It is paid when employment ends for any reason, or moved to a pension fund if the employee chooses. Budget for it from day one.

How many salaries do employees in Italy receive?

At least 13, with the tredicesima paid in December. Many collective agreements, such as commerce and tourism, also require a 14th salary in summer. Always quote annual pay to candidates, not monthly pay.

How does Good Balance Global hire employees in Italy?

As your Employer of Record (EOR), we employ your hire under the CCNL that fits the role and register the hire the day before the start date. We run payroll, pay F24 by the 16th, and accrue TFR each month.

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Payroll and benefits guide

Italy

CapitalRome

Fiscal Year1 January - 31 December

Date Formatdd/mm/yyyy

CurrencyEUR (Euro)

Payroll FrequencyMonthly

Employer Taxesapprox. 37% – 40%

Employee Costsapprox. 9.19% – 9.49%

Overview

Languages: Italian
Income tax: 23% – 43%
VAT: 22%; Reduced rates: 10%, 5%, 4%

Contributions

Employer

approx. 30%

Social security (INPS)Varies by sector, company size, and employee category under the national collective agreement (CCNL)

Varies

Work accident insurance (INAIL)Set by the risk class of the activity

approx. 7.41%

Severance accrual (TFR)Annual salary divided by 13.5, accrued each year and paid at the end of employment

approx. 37% – 40%

Total employer cost

Employee

approx. 9.19% – 9.49%

Social security (INPS)The higher rate applies to pay above an annual threshold

approx. 9.19% – 9.49%

Total employee cost

Authority Payments

Authority PaymentPaid ToDue DateMethod

Authority Payment

Revenue Agency (Agenzia delle Entrate)

Paid To

IRPEF income tax and regional and municipal surcharges withheld from salaries

Due Date

16th day of the following month

Method

F24 payment form, filed electronically

Authority Payment

INPS

Paid To

Employer and employee social security contributions

Due Date

16th day of the following month

Method

F24 payment, with the monthly UniEmens report

Minimum Wage & Working Hours

Minimum wage: None / —; No statutory minimum wage; set by sector agreements (CCNL)
Standard working hours: 40 hours per week; Average working time, including overtime, may not exceed 48 hours per week
Overtime: Premiums and annual caps set by the CCNL

Leave

Annual leave4 weeksMany CCNLs add paid leave hours (ROL) on top
Sick leaveUp to 180 days per yearINPS pays 50% of pay for days 4–20 and 66.66% for days 21–180; most CCNLs require the employer to top up
Maternity leave5 monthsUsually 2 months before and 3 after birth; INPS pays 80% and many CCNLs top up to 100%
Paternity leave10 working daysPaid at 100% by INPS; taken from 2 months before to 5 months after birth
Parental leaveUp to 6 months per parent, 10–11 months per coupleEmployees can use it until the child turns 14 (12 before 2026). INPS pays 80% for 3 months and 30% for most of the rest, within the couple's limits
Public holidaysAbout 12 national days, plus a local patron saint day

Leave type	Duration	Notes
Annual leave	4 weeks	Many CCNLs add paid leave hours (ROL) on top
Sick leave	Up to 180 days per year	INPS pays 50% of pay for days 4–20 and 66.66% for days 21–180; most CCNLs require the employer to top up
Maternity leave	5 months	Usually 2 months before and 3 after birth; INPS pays 80% and many CCNLs top up to 100%
Paternity leave	10 working days	Paid at 100% by INPS; taken from 2 months before to 5 months after birth
Parental leave	Up to 6 months per parent, 10–11 months per couple	Employees can use it until the child turns 14 (12 before 2026). INPS pays 80% for 3 months and 30% for most of the rest, within the couple's limits
Public holidays	About 12 national days, plus a local patron saint day

Termination

Probation period: Set by the CCNL; up to 6 months by law
Notice period: Set by the CCNL, based on seniority and job level
Severance pay: The accrued TFR is always paid when employment ends, whatever the reason
13th salary: Mandatory (tredicesima), paid in December; many CCNLs also require a 14th salary (quattordicesima) in June or July
Notes: Dismissal requires just cause or a justified reason; reinstatement or damages can apply if a dismissal is found unlawful

Benefits

Supplementary health fundCommon
Mandatory under many CCNLs, with a fixed monthly contribution
Meal vouchersCommon
Tax-advantaged lunch benefit, very common
Supplementary pension fundCommon
Employees can direct TFR and contributions to a sector or open pension fund
Welfare planCommon
Tax-advantaged flexible benefits for family, health, and education

Visas & Work Permits

Work permit (nulla osta) under the Decreto Flussi
Requirements
Job offer within the annual quota for non-EU workers
The employer applies; the worker then gets a visa and a residence permit
EU Blue Card
Requirements
Higher qualification and a job offer meeting the salary threshold
Outside the annual quotas

FAQ

Sources

Last updated: November 1, 2026

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