Can I Claim Employee Pay and INPS Contributions as a Business Expense in Italy?
Yes. Salaries and the employer's INPS contributions are costs of the business. The cost of permanent employees is also fully deductible from the IRAP base.
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What Agenzia delle Entrate says
The FPLD contribution for employees is 33.00% of gross pay in total, of which 9.19% is the employee share and the employer pays the remainder. Total employer cost including minor funds is typically about 30%, but the exact figure depends on the sector and needs a check against the current INPS circular. The cost of permanent employees is fully deductible from the IRAP base.
When you can claim
- Gross salaries paid to employees
- Employer INPS contributions
- Cost of permanent employees for the IRAP base
When you cannot claim
- The employee share of contributions, which is deducted from the employee's pay and is not an extra cost to the employer
- Private payments to an owner recorded as salary without being paid through payroll
Good to know
Pro tip: Do not use one employer percentage for every employee. Ask your consulente del lavoro for the rate that applies to your sector.
Important: Payroll, payslips and the monthly UniEmens and F24 filings stay with your payroll provider. AccountsOS does not submit to INPS.
Related expenses
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