Fully Managed Payroll in Italy.

It means delegating the full Italian payroll cycle to a specialist provider: calculating gross-to-net pay under the applicable CCNL, withholding IRPEF income tax and the employee’s INPS contributions, remitting employer social charges, and filing statutory returns such as the monthly Uniemens declaration and the annual Certificazione Unica. The provider also manages TFR severance accrual, INAIL work-injury cover, and the mandatory 13th (and, where the CCNL requires it, 14th) month payments. This lets a foreign company stay compliant with Italian labour and tax rules without running these processes in-house.

IRPEF is a progressive national income tax applied on three brackets for 2026: 23% up to €28,000, 33% from €28,001 to €50,000 (reduced from 35% by the 2026 Budget Law), and 43% above €50,000 (source: https://www.agenziaentrate.gov.it/portale/web/english/personal-income-tax-rates-and-calculation). On top of the national tax, employees also pay a regional surtax (addizionale regionale, roughly 1.23% to 3.33%) and a municipal surtax (addizionale comunale, up to 0.9%), which vary by residence (source: https://www.finanze.gov.it). The employer acts as withholding agent (sostituto d’imposta), deducting IRPEF and the surtaxes directly from each payslip and paying them to the tax authorities via the F24 form.

Employees are enrolled with INPS, the national social security institute, where the employer bears roughly 30% of gross pay and the employee about 10% (typically 9.19%, plus a 1% surcharge on earnings above an annual ceiling), covering pensions, unemployment (NASpI), sickness and family allowances (source: https://taxsummaries.pwc.com/italy/individual/other-taxes). Employers must also register workers with INAIL for mandatory work-injury and occupational-disease insurance, with premiums varying by risk class from under 0.5% for office roles to several percent for high-risk manual work (source: https://www.inail.it). Contributions are declared monthly through Uniemens and paid via the F24 by the 16th of the following month.

TFR (Trattamento di Fine Rapporto) is a mandatory deferred severance entitlement that every employee accrues throughout employment and receives when the contract ends, regardless of the reason. Each year the employer sets aside roughly one-thirteenth-and-a-half of annual pay (about 6.91%), and the accumulated fund is revalued annually by 1.5% plus 75% of the ISTAT inflation index (source: https://www.inps.it, Art. 2120 Civil Code). From 1 July 2026, new private-sector hires are subject to automatic enrolment of TFR into supplementary pension funds under the 2026 Budget Law, so the destination of accruing TFR is a point to confirm per employee (source: https://www.gazzettaufficiale.it).

Beyond gross salary, the largest employer cost is INPS social security at roughly 30% of gross pay, followed by INAIL work-injury premiums and annual TFR accrual of about 6.91% (source: https://taxsummaries.pwc.com/italy/individual/other-taxes). Employers must also fund the 13th month payment (tredicesima), which is effectively universal and paid in December, and a 14th month (quattordicesima) where the applicable CCNL provides for it, usually paid in June or July (source: https://topsourceworldwide.com/insights/hiring-in-italy-salary-explained/). Combined, these statutory add-ons typically push the total cost of employment to around 1.3 to 1.5 times the gross salary, with the exact figure driven by the sector’s national collective agreement (CCNL).

Running your own payroll normally requires an Italian legal entity registered with INPS, INAIL and the tax authorities, a process that can take several months and carry ongoing compliance overhead. An Employer of Record (EOR) is a compliant alternative: it becomes the legal employer, hires staff under a valid CCNL and handles all withholdings and filings, letting you hire within days without incorporating. In Italy an EOR must be a provider licensed by the Ministry of Labour, and note that an EOR does not by itself eliminate permanent-establishment risk, so employees with contracting authority or a fixed place of business can still create a taxable presence for the foreign company.