The three IRPEF rates confirmed
Article 1, paragraph 2 of Law number 207/2024 in amending the Consolidated Law on Income Taxes (TUIR, approved by Decree of the President of the Republic 22 December 1986, number 917, article 11, paragraph 1) structurally confirms the calculation of gross IRPEF according to three different percentageseach of them applied to a certain portion (bracket) of income, specifically:
- 23% on the portion of income up to 28 thousand euros;
- 35% on the portion of income over 28 thousand and up to 50 thousand euros;
- 43% on the portion of income over 50 thousand euros.
It’s called “confirmation” since the 2025 Budget introduces for an indefinite period, from last January 1st, the IRPEF rates foreseen for the 2024 tax period only by Legislative Decree number 216/2023, article 1, paragraph 1.
The minimum deduction has been confirmed at 1,955.00 euros
Article 13, paragraph 1, of the TUIR recognizes a tax deduction (the objective of which is to reduce the gross IRPEF obtained by applying the percentage rates, different in brackets, described above) for the benefit of those who:
- are holders of employee income and certain similar income;
- have a total income not exceeding 50 thousand euros.
The deduction is due as a flat rate, as provided for in the aforementioned article 13, according to a different amount based on the taxpayer’s total income.
The 2025 Budget, thanks to article 1, paragraph 2, directly modifying the TUIR confirms indefinite period there minimum deduction of 1,955.00 euros (provided for the 2024 tax period only by Legislative Decree number 216/2023) for those who total a total income not exceeding 15 thousand euros.
The minimum deduction refers to the entire tax period and is reserved for those who can claim 365 days (in the same year) of income production.
For taxpayers with a total income not exceeding 15 thousand euros the deduction actually due cannot in any case be less than:
- 690.00 euros for all employees;
- 1,380.00 euros for fixed-term employment relationships.
Reorganization of deductions for incomes exceeding 75 thousand euros
Article 1, paragraph 10 of the 2025 maneuver for completing the implementation of the tax delegation inserts article 16-ter into the TUIR “Reordering of deductions”.
The law establishes that, without prejudice to the specific limits established by each facilitation provision, for subjects with a total income exceeding 75,000.00 euros the charges and expenses (calculated pursuant to the following paragraphs 4 and 5 of article 16-ter) for which the TUIR or other legal sources provide for a deduction from the gross tax, considered as a whole, are allowed as a deduction up to the amount calculated by multiplying the basic amount by the numerical coefficient variable based on the number of children (including recognized children born out of wedlock and adopted, affiliated or fostered children) present in the taxpayer’s family unit and considered fiscally dependent.
THE’basic amount (to be multiplied by the numerical coefficient) is equal to:
- 14 thousand euros, if the taxpayer’s total income is greater than 75 thousand euros but not exceeding 100 thousand euros;
- 8 thousand euros, if the taxpayer’s total income is greater than 100 thousand euros.
The numerical coefficient instead it stands at:
- 0.50 if there are no fiscally dependent children in the family unit;
- 0.70 if there is a fiscally dependent child in the family unit;
- 0.85 if there are two fiscally dependent children in the family unit;
- 1 if there are more than two fiscally dependent children in the family unit or at least one child with a disability ascertained pursuant to article 3 of Law number 104/1992 (also fiscally dependent).
For the purposes of applying the deduction reorganization measure, the total reference income (above 75 thousand euros) is assumed net of the income of the real estate unit used as the main residence and that of the related appurtenances.
Finally, it should be noted that to consider a child as fiscally dependent it is necessary for the latter to score a personal income (before deductible charges) not exceeding 2,840.51 euros.
The income threshold goes to 4,000.00 euros for the children of age not exceeding 24 years.
