Forfettario Flat Tax and Employment: When You Can't Use It

In a nutshell

The regime forfettario — Italy's flat tax at 5% or 15% for small self-employed businesses — is not open to everyone. Specific rules exist to prevent employees from converting their salary into invoices simply to pay less tax. Before opening a Partita IVA (Italian VAT number — required to invoice as a self-employed worker), you need to check whether any of the exclusion conditions apply to you.

At a glance

Cost	None (this is a requirements check, not a procedure)
When to check	As of 1 January each year, based on the previous year's figures
Where to check	Agenzia delle Entrate (Italy's tax-revenue agency) — Regime forfetario
Documents	Your previous year's Certificazione Unica (CU) — the annual income certificate issued by your employer

The 4 situations that most commonly bar you

Even if your annual revenue stays under €85,000, you can still be excluded from the forfettario in these cases:

1. Gross salary (or pension) above €30,000 If in the previous year your income from employment or equivalent sources — salary, pension, co.co.co. contractor fees, director's compensation, NASpI (Italy's unemployment benefit), Cassa Integrazione (state-funded temporary wage support), research grants — exceeded €30,000 gross, you cannot access the forfettario. The figure that counts is the imponibile IRPEF (taxable income for IRPEF, Italy's personal income tax) shown on your Certificazione Unica — not your net take-home pay.

2. You invoice mainly your current or former employer If more than 50% of your self-employed revenue goes to your current employer — or to someone who employed you within the last two years (or to entities connected to them) — you are excluded. This rule is designed to stop genuine employment relationships from being disguised as consultancy.

3. You control an SRL operating in the same field If you hold or control a stake in an SRL or SRLS (Italian limited-liability companies) whose activity falls under the same ATECO business-sector code as your Partita IVA, and you have a commercial relationship with that company, you cannot use the forfettario.

4. You are a partner in a partnership or professional association You are excluded if you simultaneously belong to an SAS, SNC, società semplice (excluding agricultural ones), impresa familiare (family business), studio associato (professional partnership), or GEIE (European economic interest grouping). Even a minimal stake is enough to trigger exclusion. If you want to enter the forfettario, you must divest your interest before 1 January of the year in which you plan to open your Partita IVA.

The €30,000 rule: the details that matter

The threshold refers to gross income from the previous year. What counts is not what landed in your bank account after deductions, but the imponibile IRPEF on your Certificazione Unica — which is always higher than your net pay.

Several income types that people often overlook are included in the count: pensions (taxed as employment income), director's fees from companies, allowances for public office, and funded research grants (dottorati di ricerca con borsa).

Important exception: if your employment contract ended definitively in the previous year — and you did not start another one in the same year — the €30,000 threshold does not apply. So if you left your job in June and had no other equivalent income through December, you can open a Partita IVA in forfettario the following January, regardless of what you had been earning before.

The former-employer rule: watch the two-year window

The majority-revenue rule applies even after you have left a job. If you invoice more than 50% of your annual total to someone who employed you within the last two years, you are excluded. The calculation is made at year-end based on amounts actually collected (for professionals) or invoiced (for businesses).

The rule also extends to entities "connected" to your former employer: parent or subsidiary companies, and — according to guidance in Circolare AdE 9/E/2019 — even the spouse or relatives up to the second degree of shareholders. Two express exceptions exist in the law: lawyers, accountants, and notaries completing mandatory traineeships at the firm that trained them, and candidates completing compulsory vocational internships.

Real-world scenarios: in or out?

• Gross salary €35,000, want to open a Partita IVA: excluded. Income exceeds the threshold and the employment is still ongoing.
• Gross salary €25,000, want to open a Partita IVA: eligible, provided you do not invoice mainly your employer and have no incompatible company interests.
• Made redundant 30 September 2025, no other job, open Partita IVA January 2026: eligible. The employment ended in the previous year without being replaced.
• Gross pension €28,000, want to open a Partita IVA: eligible (below the threshold).
• Gross pension €35,000, want to open a Partita IVA: excluded. Pensions count as employment-equivalent income.
• 60% shareholder in an SRL in your same sector: excluded if you exercise control over the company.
• Sole director of an SRL with a €40,000 director's fee: excluded. The fee counts as employment-equivalent income and exceeds €30,000.

Mistakes to avoid

1. Looking at net rather than gross. The €30,000 limit refers to the imponibile IRPEF on your Certificazione Unica — not your net take-home. Gross is always higher.
2. Forgetting the pension. Many pensioners who open a Partita IVA don't realise their pension is treated as employment income for this rule. If the gross pension exceeds €30,000, the forfettario is off the table.
3. Underestimating the two-year rule on former employers. Even after leaving a job, if you continue to invoice mainly your old company within two years, you are excluded. Track the composition of your revenue throughout the year.
4. Not checking your spouse's company interests. If your spouse is a shareholder in an SRL operating in your same sector, an indirect connection could be found under Circolare AdE 9/E/2019.
5. Selling SRL shares in December instead of before 1 January. The exclusion applies if you are still a shareholder on 31 December. You must divest before the start of the year in which you want to enter the forfettario.

Special cases

Foreigners resident in Italy: the exclusion rules apply to you without exception. The forfettario in any case requires Italian tax residency (registered residence for more than 183 days per year, or your main economic base in Italy, under art. 2 TUIR — Italy's consolidated income-tax act). EU or European Economic Area citizens not resident in Italy can access the regime only if they earn at least 75% of their total income here. For non-EU citizens not resident in Italy, no such exception exists.

When you lose the forfettario: some grounds for exclusion operate from the following year (employment income, company interests opened during the year); others apply immediately during the year (exceeding €100,000 in revenue triggers immediate exit); others are assessed at year-end (majority invoicing to a former employer). If you exit the forfettario, you must start charging IVA (Italian VAT), keep accounting records, and become subject to withholding-tax rules. You can re-enter the forfettario as soon as you meet all the requirements again for a full calendar year.

Official sources

• Agenzia Entrate — Regime forfetario
• Agenzia Entrate — General information on the regime
• Circolare AdE 9/E/2019 — Clarifications on exclusion grounds (PDF)
• Normattiva — Legge 190/2014

Legal references: L. 190/2014 art. 1 comma 57 (cause di esclusione); L. 145/2018 art. 1; L. 197/2022 art. 1 commi 54-55; Circolare AdE 9/E/2019; Circolare AdE 32/E/2023; artt. 49, 50 TUIR; art. 2359 c.c.; art. 2 TUIR.