Italy tax deductions in 2026: every credit you can claim, and the caps

Last reviewed: November 2026 · Reviewed by Stéphane Gombauld, tax expert, technologist and digital nomad

You work in Italy, or will soon, and you want to know which expenses actually lower your IRPEF bill. After this guide you will know the main deductions and credits for 2026, the income caps, and what to keep for the return.

Italy personal deductions and benefits in 2026: the key figures

Is this guide for you?

Read on if you…

• are an employee or freelancer taxed under ordinary IRPEF rules in Italy;
• have children, a mortgage, medical bills or renovation plans;
• want to know whether the high-earner cap hits you.

Probably not your case if you…

• use the forfettario flat-rate regime. Almost no credits apply, since you pay a 15% or 5% substitute tax instead;
• are not Italian resident and earn less than 75% of your income in Italy. Family credits are mostly closed to you.

Deduction or credit: what is the difference in Italy?

Italy uses two tools, and they work very differently.

• A deduction (deduzione or onere deducibile) reduces your taxable income. Its value depends on your top rate. At 43%, EUR 1,000 deducted saves EUR 430.
• A tax credit (detrazione) reduces the tax itself. Most are 19% of the expense, whatever your bracket. EUR 1,000 of health costs saves EUR 190, for everyone.

Most Italian benefits are credits. Here's the catch: a credit is lost if your tax is too low to absorb it. Unused amounts are not refunded, except for some employee credits.

Which deductions reduce your taxable income?

These come off your income before IRPEF is calculated (article 10 TUIR).

1. Compulsory social security contributions. Fully deductible. That covers INPS for freelancers, artisans and traders, and your own share as an employee.
2. Supplementary pension contributions. Up to EUR 5,164.57 a year into an Italian pension fund or individual pension plan.
3. Maintenance paid to a former spouse, under a court order. Child maintenance is not deductible.
4. Donations to religious institutions and certain charities, within set limits.
5. Contributions for domestic workers, up to EUR 1,549.37 a year.

Honestly? For most freelancers, the pension-fund deduction is the cleanest lever. At a 43% rate, EUR 5,000 paid in saves about EUR 2,150 of IRPEF, plus local surcharges.

Which tax credits can you claim in 2026?

Work and family credits

• Employees: up to EUR 1,955 for income up to EUR 15,000, decreasing to zero at EUR 50,000. Since 2025, an extra benefit applies to lower salaries: a bonus up to EUR 20,000 and an additional credit of EUR 1,000 between EUR 20,000 and EUR 40,000.
• Self-employed: up to EUR 1,265, also decreasing to zero at EUR 50,000.
• Pensioners: up to EUR 1,955, decreasing with income.
• Dependent spouse: up to EUR 800, decreasing with income.
• Dependent children aged 21 to 29: up to EUR 950 each, decreasing with income. Disabled children have no age limit.
• Other dependent relatives: since 2025 limited to cohabiting parents and grandparents, up to EUR 750.

A family member is "dependent" if their own income stays under EUR 2,840.51, or EUR 4,000 for children up to age 24.

Children under 21 no longer give a tax credit. They are covered by the assegno unico universale, a monthly allowance paid by INPS. It depends on your ISEE, the family means indicator.

Expense credits at 19%

Housing credits

• Renovation bonus (bonus ristrutturazioni): 50% on the main home, 36% on other homes, spread over 10 years.
• Young renters: under-31s renting their main home get 20% of the rent, up to EUR 2,000 a year, for four years.
• Renters generally: a fixed credit of EUR 300 or EUR 150 depending on income.

Donations

Donations to registered non-profits (ETS) give a 30% credit on up to EUR 30,000. Donations to volunteer organisations get 35%.

What changes above EUR 75,000 of income?

Since 2025, high earners face a cap on most credits (article 16-ter TUIR). The cap applies to the total of the 19% credits, donations and building bonuses. Health costs and mortgage interest on loans before 2025 are left out.

• Income EUR 75,000 to 100,000: base amount EUR 14,000.
• Income above EUR 100,000: base amount EUR 8,000.

The base is multiplied by a family coefficient: 0.50 with no children, 0.70 with one, 0.85 with two, 1 with three or more or a disabled child. A childless earner above EUR 100,000 can claim at most EUR 4,000 of qualifying expenses.

On top of that, most 19% credits shrink between EUR 120,000 and EUR 240,000 of income, and vanish above. Health costs are exempt from this phase-out.

Can expats and non-residents claim these benefits?

Residents claim everything, whatever their nationality. If you use the impatriate regime from tax incentives for expats and digital nomads in Italy, the credits still apply to the tax due on the taxed half. But your lower tax may not absorb them all.

Non-residents pay IRPEF only on Italian-source income. They get credits for interest, donations and a few others, but not family credits. The exception: EU and EEA residents earning at least 75% of their total income in Italy are treated like residents.

Not sure which side you are on? The tests are in tax residency in Italy.

How to claim

1. Keep receipts and proof of traceable payment for every 19% expense.
2. Check the pre-filled return (730 precompilato) on the Agenzia delle Entrate portal from late April.
3. Employees file the 730 by 30 September and receive any refund through payroll.
4. Freelancers file the Redditi PF return, usually by 31 October.

Common mistakes (and what they cost)

• Paying the doctor in cash. Except for medicines and public health, the 19% credit is refused. EUR 2,000 in cash loses EUR 380.
• Claiming a child under 21. The credit no longer exists, so the Agenzia recovers it with interest and a penalty.
• Ignoring the EUR 75,000 cap. Overclaimed credits are reassessed, with a 70% unfaithful-return penalty on the extra tax.
• Choosing forfettario and expecting credits. Most are lost. Compare both regimes before your first invoice.
• Not checking the 730 precompilato. Missing receipts mean missed credits, and you cannot claim them later without amending.

Frequently asked questions

What can I deduct from my taxes in Italy in 2026?

Compulsory social contributions, supplementary pension payments up to EUR 5,164.57, maintenance paid to a former spouse and some donations reduce taxable income. Most other benefits are 19% tax credits: health costs above EUR 129.11, mortgage interest on the main home, school and university fees, insurance and sport for children. Renovations give 50% or 36% over ten years.

How does the Italian health expense credit work?

You get a 19% tax credit on medical, dental and pharmacy costs above EUR 129.11 a year. There is no upper limit. Costs for dependent family members count too. Except for medicines, devices and public health services, you must pay by card or bank transfer. Keep receipts, though most appear in the pre-filled return automatically.

Do I get tax credits for children in Italy?

Not for children under 21. They are covered by the assegno unico universale, a monthly allowance from INPS based on your family ISEE. For dependent children aged 21 to 29, you can claim up to EUR 950 each, decreasing with income. Disabled children give a credit at any age. A child is dependent if their income stays under EUR 4,000.

Is there a limit on deductions for high earners in Italy?

Yes. Since 2025, if your income exceeds EUR 75,000, the total of most credits is capped. The base amount is EUR 14,000, or EUR 8,000 above EUR 100,000, times a coefficient from 0.50 to 1 depending on your children. Most 19% credits also phase out between EUR 120,000 and EUR 240,000, except health costs.

Can non-residents claim Italian tax deductions?

Partly. Non-residents taxed on Italian income can claim some credits, such as mortgage interest and donations, but not family credits. EU and EEA residents earning at least 75% of their total income in Italy are treated like residents and can claim everything. Proof of worldwide income is required for that status.

Can I use deductions with the forfettario regime?

Hardly. Under the forfettario you pay a 15% or 5% substitute tax on a notional profit, not IRPEF. Your compulsory INPS contributions are deducted from that notional profit, but 19% credits and family credits generally cannot be used. That is why some families with high expenses are better off under ordinary IRPEF.

Related guides

• Tax incentives for expats and digital nomads in Italy
• Tax residency in Italy: the 183-day test and domicile rule
• Business expenses in Italy for freelancers and companies
• Specific taxes in Italy: IVAFE, IVIE, IMU and inheritance
• Personal tax deductions and benefits of Portugal
• Personal tax deductions and benefits in Spain
• Tax landscape overview of Italy
• All country tax guides

Sources

• Agenzia delle Entrate – official portal
• Normattiva – TUIR (Presidential Decree 917/1986), articles 10, 12, 13, 15 and 16-ter
• Gazzetta Ufficiale – Budget Laws 2025 and 2026
• INPS – assegno unico universale and contributions
• Ministry of Economy and Finance – Dipartimento delle Finanze
• PwC Worldwide Tax Summaries – Italy

This guide is general information, not personalised tax advice. See how we research and review.