Monthly payment
By the 16th of the month following the payment, with an F24 and a specific tax code for each type of income.
VAT numbers · Invoicing
Withholding tax: the ritenuta d'acconto
It is not an extra tax: it is an advance your client pays on your behalf. Problems start when the person who suffers it leaves it out of the calculation of their balance, or when the person who applies it forgets to pay it over.
01 · How it works
What the ritenuta d'acconto is
The ritenuta d'acconto (withholding tax on account) is an amount withheld by whoever pays a fee from the sum due and paid directly to the Treasury on behalf of the person receiving it. Whoever applies it is called the sostituto d'imposta (withholding agent): it stands in for the recipient in making the payment.
For the person who suffers it, it is not a cost: it is an advance on the tax they will have to pay anyway. In the tax return the withholding is subtracted from the tax due, and if it exceeds that tax it creates a credit.
- It applies to self-employment fees, both professional and occasional.
- To the commissions of agents and representatives, on a reduced taxable base.
- To employment and similar income, where however the term used is withholding tax on account with a year-end adjustment.
- To some investment income and certain services, at their own rates.
- To bank transfers for building bonuses, as a withholding made by the bank when crediting the business.
A withholding on account is an advance you recover in your tax return. A withholding as final tax, on the other hand, is definitive: it closes the tax relationship and the income no longer goes into the return. They are two different things that are often confused.
02 · The withholding agent
Who must apply the withholding tax
Not every client is a withholding agent. It depends on who pays, not on who collects: the same invoice carries a withholding if the client is a business and does not if the client is a private individual.
- Whoever applies the withholding must pay it over by the monthly deadline, using the F24 form (the Italian tax payment form) and its own tax code.
- They must issue the Certificazione Unica (the annual income and withholding statement) to the recipient, by the annual deadline.
- They must file the 770 return, which summarises all the withholdings made and paid.
- A condominium is a withholding agent for the services it receives, with obligations that fall on the building manager.
- The withholding agent is liable for the payment even if it did not withhold: having forgotten the withholding does not release it from the obligation.
| Who pays | Do they apply the withholding? |
|---|---|
| Companies: SRL, SNC, SAS | Yes |
| Sole trader or professional with a partita IVA (Italian VAT number) | Yes |
| Public body or administration | Yes |
| Condominium | Yes, under its own rules |
| Private individual without a partita IVA | No |
| Foreign client | No, except in particular cases |
Taxpayers under the flat-rate scheme (regime forfettario) do not suffer withholding on their own invoices, and must include on the invoice the wording that states this. They are not, however, exempt from applying withholdings when they themselves pay a professional or a collaborator: that is a separate position.
03 · Filling it in
How to fill in the invoice
The withholding is calculated on the taxable amount, not on the invoice total, and is subtracted at the bottom of the invoice. In the electronic invoice the dedicated block must be filled in, otherwise the data does not reach the Sistema di Interscambio (the national e-invoicing exchange system).
Taxable amount
The agreed fee, net of any discounts. This is the base on which the withholding is calculated.
Pension contribution
The recharge of the professional fund's contribution follows its own rules; the supplementary contribution of some funds is not subject to withholding.
VAT
It is calculated on the taxable amount plus the supplementary contribution where applicable. The withholding does not affect VAT.
Withholding
It is applied as a percentage of the taxable amount and subtracted from the total. The net amount payable is the total less the withholding.
The most common mistake
Calculating the withholding on the invoice total instead of the taxable amount.
- The withholding applies to the fee, never to the VAT
- It does not apply to the supplementary contribution of some funds
- The net amount payable is what the client actually transfers
- In the electronic invoice the DatiRitenuta block must be filled in, not just written in the description
04 · Getting it back
How you recover it in your tax return
The withholdings you have suffered are subtracted from the tax due. The result can be a lower amount due, a zero balance or a credit.
- Withholdings are entered in the dedicated section, adding up those shown on all the Certificazioni Uniche you have received.
- They are attributed to the period in which the fee was collected, under the cash basis that applies to self-employment.
- If they exceed the tax due, they create a credit that you can claim as a refund or offset through the F24.
- A withholding not paid over by the withholding agent can still be subtracted by the recipient, provided it was actually withheld and is documented.
- Withholdings count in the calculation of the advance payments for the following year, reducing their base.
If the client does not send you the Certificazione Unica, you can still subtract the withholding: the invoice and proof of receiving the net amount are enough to show it was withheld. It is still worth chasing the certificate, because it makes every later check simpler.
05 · Without a VAT number
Withholding tax on occasional work
If you carry out occasional work without a partita IVA, you issue a receipt, not an invoice, and you still suffer the withholding if the client is a withholding agent.
- The receipt shows the gross fee, the withholding and the net amount, plus the revenue stamp above a certain amount.
- There is no VAT, because the activity is not carried out habitually.
- Once occasional fees exceed an annual threshold, you must register with the Gestione Separata (the separate pension scheme run by INPS, the Italian social security institute).
- It is the habitual nature of the work, not the amount, that makes opening a partita IVA compulsory.
- The income is declared among miscellaneous income, net of specifically documented expenses.
Occasional work is not a shortcut to avoid a partita IVA. If the activity is continuous and organised, the correct classification is professional, however many receipts you issue in a year.
06 · For whoever applies it
What the withholding agent must do
There are three obligations with three different deadlines, and failing to meet each one has different consequences.
Certificazione Unica
To be issued to the recipient and sent to the Agenzia delle Entrate (the Italian Revenue Agency) by the annual deadlines. It feeds into the pre-filled tax return.
770 return
The annual summary of all withholdings made and paid, with the details of the recipients.
If you got it wrong
A late payment is put right with ravvedimento (voluntary correction). Failing to issue the certificate carries a separate penalty for each recipient.
Frequently asked
The questions that keep coming up
I am under the flat-rate scheme. Do I have to apply withholding on my invoices?
No. Taxpayers under the regime forfettario do not suffer withholding tax on their fees and must state this on the invoice with the prescribed wording.
Watch the opposite side, though: when you are the one paying a professional or a collaborator, the withholding must be applied and paid over even if you are under the flat-rate scheme. They are two separate positions, and the second does not lapse because of the scheme.
My client did not pay over the withholding. Do I lose it?
No. If the withholding was actually made, meaning you received the net amount, you can subtract it in your tax return even if the withholding agent did not pay it over.
Responsibility for the payment lies with the withholding agent. You need the invoice and proof that you received the net amount, which show that the withholding took place.
I am invoicing a private individual. Do I have to show the withholding?
No. A private individual without a partita IVA is not a withholding agent and does not withhold anything: the invoice closes on the total, with no withholding.
You will pay the whole tax yourself through the balance and advance payments in your tax return. It is something to bear in mind when planning your cash flow, because there are no advances already paid.
I paid the withholding late. What am I facing?
The penalty for late payment applies, which can be reduced with ravvedimento operoso according to how many days late you are, plus interest.
The correction must be made before any tax check. A delay of a few days costs very little extra; a delay of months becomes significant.
Let's talk
If you pay with withholding, you have obligations you often do not know about
The monthly payment, the Certificazione Unica, the 770 return. They are three separate obligations and none of the three is optional.