The flat-rate tax regime is a simplified tax system designed for freelancers, artisans, and self-employed professionals who meet certain requirements. It defines taxes, contributions, and obligations but also offers several benefits compared to the ordinary tax regime.

1. Reduced Taxes

Under the ordinary regime, a sole proprietorship may pay between 23% and 43% in taxes.

With the flat-rate regime, however, you only pay 15% — this single tax replaces IRPEF (personal income tax), regional/municipal surtaxes, and IRAP.

When starting a new business, you can even pay just 5% for the first five years.

2. No VAT

Normally, VAT is added to the price of products or services, increasing the cost for the client.

Under the flat-rate regime, VAT is not applied, allowing you to offer more competitive prices.

3. No Sector Studies

Sector studies (now called ISA) estimate how much a professional should earn based on their industry; earning below the average can lead to extra taxes.

In the flat-rate regime, you don’t have to worry about these checks.

4. Reduced Social Contributions

If your business is artisanal or commercial (e.g., plumber or e-commerce), you can reduce INPS social contributions by 35%.

Example: an artisan who normally pays €4,500 in contributions will pay about €2,925 with this reduction.

To qualify for the flat-rate regime, you must meet all the following criteria:

• Be a resident of Italy (or an EU/EEA country, with at least 75% of your income generated in Italy)

• Not be a partner in a partnership

• Not hold majority shares in a limited company operating in the same sector

• Have earned no more than €85,000 in self-employment income in the previous year

• Have paid no more than €20,000 to employees or collaborators

• If also employed, your gross annual salary (RAL) must not exceed €35,000 (previously €30,000)

To benefit from the 5% tax rate instead of 15%, you must also meet these additional conditions:

• Your activity must not be a continuation of a previous salaried job

• You must not have held a VAT number in the previous three years

• The previous activity must not have earned more than €85,000

To maintain eligibility for the flat-rate regime, you must:

• Continue to meet all the initial requirements

• Earn less than €85,000 per year

• Not pay more than €20,000 to employees

• If employed, maintain your salary below the set limit.

If you exceed the limits:

• With income under €100,000, you exit the regime the following year

• With income over €100,000, you exit immediately

You may re-enter the flat-rate regime in later years if you again meet all the criteria.

Professionals enrolled in private pension funds:

• Pay objective, supplementary, and maternity contributions according to their fund’s rules.

Freelancers without a private pension fund:

• Must register with the INPS Separate Management scheme

• Pay contributions proportional to income — in 2024, the rate is 26.07% on income (revenue minus deductible expenses)

Artisans and traders:

• Register with the INPS Artisans or Traders Management scheme

• Pay fixed contributions (€4,500 in 2024, divided into four quarterly payments)

• Pay variable contributions (24% on income exceeding €18,415)

• Taxable income is calculated by applying a profitability coefficient (based on your business’s ATECO code) to your total revenue or fees, then subtracting paid social contributions.

• The resulting taxable income is then subject to a flat tax of 15% or 5%