Taxation
A pension is treated like employment income: INPS withholds tax and issues the Certificazione Unica (the annual income statement).
CAF services · Pensions
Retirement age in Italy: when you can retire
The date does not depend on age alone: it depends on how many contributions you have, where you paid them and which calculation rule applies to you. Those are three variables, and the second is the one with the most surprises.
01 · The routes
Retirement age in Italy: the routes to a pension
There is not just one pension: there are several routes in, each with its own requirements for age, contributions or both. Knowing which one applies to you is the first step.
| Route | Main requirement |
|---|---|
| Old-age pension | Age plus a minimum number of years of contributions |
| Early pension | A long contribution record, regardless of age |
| Early contribution-based pension | A lower age with a minimum pension amount, for people whose contributions all fall under the contribution-based system |
| Arduous and strenuous work | Reduced requirements when the set conditions are met |
| Ape sociale and bridging measures | Temporary measures for protected categories, with their own requirements |
| Opzione donna and similar measures | Experimental routes, restricted and subject to yearly extensions |
The age and length-of-service requirements are subject to periodic adjustment in line with life expectancy: the date that applies today is not necessarily the one that will apply in three years. That is why the check has to be done again, not inherited from a calculation made a few years ago.
02 · The deciding variable
Counting your contributions
This is the part with the most surprises, because hardly anyone has a straight career in a single pension scheme.
- Periods of employment, self-employment and in the Gestione Separata (the separate INPS scheme for freelancers and contract workers) have to be added together.
- Notional periods (military service, maternity, paid unemployment, cassa integrazione, the short-time work allowance) count towards entitlement.
- Contributions to professional pension funds do not appear on the INPS (Italian social security institute) statement and have to be checked separately.
- Periods abroad are counted through EU aggregation or through bilateral agreements.
- Gaps in contributions should be looked for in advance, not at the application: see contribution statement.
- Buying back periods and voluntary contributions can fill the gaps, but they need to be assessed with the figures in front of you.
- Cumulo (combining periods) lets you add up periods in different schemes at no cost, with its own calculation rules.
- Totalizzazione (aggregation) is a separate arrangement, with different calculation criteria.
- Ricongiunzione (transfer) moves the periods into a single scheme, but it comes at a cost.
- The choice between the three affects both the date and the amount: it is not neutral.
03 · The amount
How the amount is worked out
The calculation method depends on how many contributions you had at a certain date, and it makes a significant difference.
Earnings-based system
Based on your final earnings. It applies to the parts of the pension built up until the reference dates set by the reforms.
Contribution-based system
Based on the contributions actually paid, revalued and converted into an annuity with coefficients linked to your retirement age.
Mixed system
The most common situation: one part calculated on the earnings-based system and one on the contribution-based system, depending on the reference date.
Conversion coefficients
Under the contribution-based system, retiring later means a more favourable coefficient: postponing has a direct effect on the pension.
Why waiting sometimes pays
Under the contribution-based system, time works in your favour.
- Every extra year adds contributions to your pension pot
- The conversion coefficient improves with age
- The revaluation of the pot continues
- It has to be weighed against the years of pension you give up
04 · How to apply
How to apply for your pension
The pension does not arrive on its own: you have to apply for it, and when you apply affects the start date.
- The application is made online, with SPID or CIE (the Italian digital identity systems), or through a CAF (authorised tax assistance centre) or a patronato (welfare advice office) with a proxy.
- It must be submitted ahead of the start date you want, to leave time for processing.
- The start date does not coincide with meeting the requirements: some routes have waiting windows.
- If you are still working, you need to coordinate the application with the end of your employment.
- Any contribution accounts open as a self-employed person must be closed.
- Arrears are due from the start date, but processing can take months: allow for a period with no income.
The period between the end of work and the first pension payment is the most delicate moment, and it often lasts several months. It needs planning around the cash you have available, also taking into account how long the TFR (severance pay) takes to be paid.
05 · What follows
What changes once you are retired
A pension is income in every respect, and it brings obligations that many people discover in their first year.
Tax return
If your only income is your pension you may not be required to file, but it is often worth filing the 730 (the Italian tax return for employees and pensioners) to recover tax credits.
Pension tax credits
They exist and must be claimed: they are different from those for employment income.
RED form
For income-linked benefits, it must be filed every year. See RED form.
Working as a pensioner
It is possible with an old-age pension; for some early routes there are limits on combining the pension with earned income.
ISEE
The pension counts towards the ISEE (the household means test indicator) and affects the household's means-tested benefits.
06 · The checks
What to check before you retire
These are five checks worth doing at least a couple of years before the date you have in mind.
- Your contribution statement: gaps, missing periods, wrong earnings. This is where something almost always turns up.
- Periods with other schemes or funds, which the INPS statement does not show.
- Periods abroad, to be counted through aggregation or a bilateral agreement.
- Whether buying back periods or making voluntary contributions pays off, calculated on the effect on date and amount.
- The choice between combining, aggregation and transfer, if you have periods in different schemes.
- Whether you can manage the transition period between your last salary and your first pension payment.
The right time for the check is not the year you retire: it is at least five years before. A missing period found in time can be recovered; found at the application, often not, and in the meantime the date has moved.
Frequently asked
The questions that keep coming up
How many years of contributions do I need?
It depends on the route. The old-age pension requires a certain age plus a minimum number of years of contributions; the early pension requires a long contribution record regardless of age.
The requirements are also subject to periodic adjustment in line with life expectancy. The exact answer comes only from your contribution statement, looking at your actual record.
I have worked under three different schemes. Do I lose anything?
No, but the right tool has to be chosen. Combining lets you add up periods at no cost; aggregation is a separate arrangement with its own calculation criteria; transfer moves the periods but comes at a cost.
The choice affects both the date you can retire and the amount of the pension, and it has to be made with the figures in front of you: there is no single answer for everyone.
Is it worth putting off retirement by a year?
Under the contribution-based system, often yes: an extra year adds contributions to the pot and improves the conversion coefficient, with a direct effect on the pension.
It does, however, have to be weighed against the year of pension you give up. The comparison is made on the numbers: how much the monthly pension grows against how many months it takes to make up what you did not receive.
Can I keep working once I have retired?
With an old-age pension, yes, without any particular limits: it can be fully combined with employment and self-employment income.
For some early retirement routes, however, there are limits on combining the pension with earned income until you reach the old-age pension age. Check this before accepting any work.
Let's talk
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