How to read an Italian payslip (busta paga)
An Italian payslip (busta paga or cedolino) starts with the pay set by your collective agreement, then takes off INPS contributions, IRPEF and the local surcharges. On a €35,000 RAL in Milan you take home about €2,002 in each of 13 payments in 2026. Here is what each line means.
The lines on your payslip
| Line | What it means |
|---|---|
| Paga base / minimo tabellare | Basic pay set by your national collective agreement (CCNL) for your level |
| Contingenza, scatti di anzianità, superminimo | Other fixed parts of pay: an old cost-of-living element, seniority increases and any amount above the CCNL minimum |
| Totale competenze | Total gross pay for the month, including overtime and allowances |
| Imponibile previdenziale | The pay INPS contributions are charged on |
| Contributi INPS (IVS) | Your pension contribution: usually 9.19%, plus 1% on pay above €56,224 a year |
| Imponibile fiscale / IRPEF | Pay after INPS: the base for income tax |
| IRPEF lorda | Income tax at 23%, 33%, 43% on the monthly share of the yearly brackets |
| Detrazioni lavoro dipendente | The employee tax deduction, spread over the year |
| Ulteriore detrazione / somma esente | Tax-wedge measures: an extra deduction from €20,000 to €40,000, or a tax-free payment up to €20,000 |
| Trattamento integrativo | A €100 a month bonus for low incomes |
| Addizionale regionale e comunale | Regional and municipal surcharges, mostly for the previous year |
| Ratei | Accruals: holiday (ferie), paid leave (permessi, ROL), the 13th and any 14th month |
| TFR | Severance pay you build up each month; usually not paid out until you leave |
| Netto in busta | What reaches your bank account |
Worked example: €35,000 RAL
Milan, single, 13 payments, 2026
Each ordinary month pays €2,692.31 gross, of which €247.42 goes to INPS. Over the year your payslips add up to:
| Item | Year | Per payment | Monthly average |
|---|---|---|---|
| Gross salary | €35,000.00 | €2,692.31 | €2,916.67 |
| INPS social security | −€3,216.50 | −€247.42 | −€268.04 |
| IRPEF income tax | −€5,042.08 | −€387.85 | −€420.17 |
| Regional surcharge | −€454.98 | −€35.00 | −€37.92 |
| Municipal surcharge | −€254.27 | −€19.56 | −€21.19 |
| Take-home pay | €26,032.17 | €2,002.47 | €2,169.35 |
Payroll spreads tax over the year differently: deductions are given month by month, the 13th month is taxed in December and the surcharges come the following year, so single payslips vary even though the yearly total is the same. Check your own salary.
The 13th and 14th month
Most collective agreements pay a tredicesima, one extra month's pay, in December. Some, such as those for commerce and tourism, add a quattordicesima in June or July. They are part of your RAL, not on top of it: a €35,000 RAL over 13 payments is €2,692 a month, and over 14 payments €2,500.
TFR: severance pay
Every year your employer sets aside about one month's pay, your yearly pay divided by 13.5, as TFR (trattamento di fine rapporto); on €35,000 that is about €2,593. It is revalued each year by 1.5% plus 75% of inflation and paid when you leave, taxed separately from your other income, or you can send it to a supplementary pension fund. The payslip usually shows the amount built up so far. Since 1 July 2026, private-sector employees hired for the first time are enrolled in a pension fund automatically and their TFR goes there, unless they opt out within 60 days.
The conguaglio and the surcharges
Each month payroll withholds IRPEF as if that month's pay continued all year. With the December pay (at the latest by 28 February), or when you leave, it makes the conguaglio: the yearly tax is worked out exactly and the difference is refunded or deducted. The regional and municipal surcharges for a year are deducted the following year in up to 11 monthly instalments, and 30% of the municipal surcharge is taken in advance from March.
Other lines you may see in 2026
- Imposta sostitutiva 5%: pay rises from 2026 collective agreement renewals are taxed at 5% instead of IRPEF if your 2025 employment income was up to €33,000.
- Imposta sostitutiva 15%: night, public holiday and shift allowances, up to €1,500, if your 2025 employment income was up to €40,000.
- Fringe benefit: benefits in kind, such as meal vouchers above the tax-free limit, added to taxable pay.
Sources
- INPS: circolare 6/2026 (2026 thresholds and contribution ceiling)
- Agenzia delle Entrate: IRPEF rates and calculation
- Agenzia delle Entrate: circolare 4/E of 16 May 2025 (tax-wedge measures explained)
- Civil Code article 2120: TFR
- DPR 600/1973 article 23: withholding and the conguaglio
- D.Lgs. 360/1998 article 1: municipal surcharge instalments and advance
- Agenzia delle Entrate: circolare 2/E of 24 February 2026 (5% and 15% substitute taxes)
- D.Lgs. 252/2005 article 8: automatic pension fund enrolment
- Our methodology and the full list of sources for the calculator
Frequently asked questions
What is the difference between RAL and netto in busta?
RAL (retribuzione annua lorda) is your gross yearly salary. Netto in busta is what you receive each month after INPS, IRPEF and the surcharges. On a €35,000 RAL in Milan you receive about €2,002 in each of 13 payments.
Why is my December payslip different?
In December you receive the tredicesima (13th month), and payroll usually does the conguaglio (at the latest by 28 February): it recalculates your tax for the whole year and corrects what was withheld, so the payslip can show a refund or an extra deduction.
Why are regional and municipal surcharges deducted when I have just arrived?
In your first year they mostly are not. Payroll deducts the surcharges for a year in the following year, in up to 11 monthly instalments, plus a 30% advance of the municipal surcharge from March based on the previous year. New arrivals usually see them only from their second year.
This guide explains the general rules for employees and is not personal tax advice. Rules change and individual situations differ, so check with the tax authority or a tax adviser before making decisions. Spotted something out of date? Email [email protected].