Tax return (dichiarazione dei redditi): what it is and how to do it
The tax return is the document used to transmit to the Italian government your income in order for the taxes to be calculated and paid. On this page, you will find useful information on how the tax return works, the necessary documents, where it is done and the deadlines.
What is the tax return?
The tax return is a document through which you officially communicate to the government how much you have earned the previous year in order to know how much you have to pay in taxes. In Italy, in fact, taxes are paid in proportion to:
- your income (ie how much you earned with your job)
- based on the assets you own (for example, if you own a house) and
- the number of members in your family
The tax return must be made every year and contains the income information of the previous year. For example, the 2020 tax return is filed in 2021.
To file the dichiarazione dei redditi you must have the Certificazione Unica (CU). The CU is the document that summarizes all your earnings from employment or self-employment (if you have partita IVA or VAT number). You can get the CU from:
- your employer (if you are an employee);
- the person who commissioned your work (if you are a self-employed person with partita IVA);
- or from the INPS (if you have been on cassa integrazione or unemployment).
Who needs the tax return?
The tax return is necessary for:
- the Revenue Agency (Agenzia delle Entrate), meaning the Italian government, to check and calculate the taxes that citizens have to pay;
- the citizens to be in compliance with the taxes they have to pay and to recover a part of the expenses they had during the year.
Who has to do the tax return?
According to the law, you have to file the tax return if the previous year:
- you had two or more employers, and then you received more than one Certificazione Unica (CU);
- you were employed for a few months, but then you lost your job and you received cassa integrazione or unemployment benefit from the INPS or other institutions;
- you had a partita IVA, even if you did not make any invoice (fattura), meaning even if you were never paid;
- you have received deductions that must be returned. These are discounts made on certain expenses that allow you to save money when you file the tax return;
- you have not paid any obligatory local taxes (for example TARI the waste tax, IMU the property tax, etc.) which change for each region and municipality;
- you worked as an employee for an employer who is not legally obliged to pay taxes in your name (for example, jobs such as colf, housekeeper, caregiver, babysitter, etc.).
IMPORTANT: even in some of these cases, filing the tax return might not be mandatory. For example, if a person has two CU, but before starting the second job asks the new employer to take into account the old pay slips for the payment of taxes, they are not obliged to file taxes.
Taxes in Italy are very complicated and regulations can change, so it is always better to consult with a professional.
Why is it important to do the tax return?
In Italy, filing taxes is an obligation provided by law. Individuals who have to file taxes and do not do so risk being fined. In special cases, it can also become a crime and you risk going to jail.
People who do not have to file their taxes can still do it to have an advantage: recover spese detraibili (deductible expenses) through expenses refunds.
Spese detraibili are some expenses that you made in the previous year and for which you can receive a rimborso (refund) from the government. Rimborso means you get your money back.
The law establishes what expenses are deductible. Some are always deductible every year, others can change from year to year. Deductible costs are, for example: medical expenses, nursery expenses, school and/or university fees, public transport service subscriptions (bus, train), etc.
Remember, however, that there are specific rules to receive the reimbursement of deductible expenses. In addition, the refund is never equal to the amount you spent, but is returned to you by a lower amount.
Here is an example, for reimbursement of health costs you should be aware of:
- You won’t get all the money you spent, but only 19% of what you spent;
- You receive it only if you have exceeded the figure of 129.11 euro of sanitary expense;
- Charges must be paid by credit card, debit card or bank transfer.
You can also ask for a refund for medicines. To obtain a refund you must ask at the pharmacy for the “scontrino parlante” (receipt). You get it by showing your codice fiscale (by ID or tessera sanitaria). It’s called scontrino parlante because it has your details on it and you’ll need it to prove the expense you’ve made and receive your refund.
Where to file the tax return?
You can go to a Tax Assistance Center (CAF) or an accountant (commercialista).
- CAF are authorized offices that offer tax assistance to citizens and workers. For example, they can help you to file and submit your tax declaration, bonus requests, ISEE model and all those requests that require specific skills. Many of the services offered are free but for some you need to pay. To receive assistance you must first make an appointment.
To find the CAF in your area, search online the words: CAF + name of your city (for example CAF Firenze).
- The accountant is an experienced and authorized person in tax services and can help you fill out and submit your tax declaration. Unlike the CAF, however, an accountant can cost a bit more.
- You can also submit your tax declaration by yourself by entering the website of the Revenue Agency (Agenzia delle Entrate). You must access the private area using your PIN, SPID or INPS-issued credentials and verify the details. Remember, however, that it is not easy to verify the data well, especially if it is the first time you do it or do not have much experience.
How much does it cost to file taxes?
It depends on where you decide to go!
- If you get help from a CAF, the price also changes according to your income range, which is how much you have earned the year before. Usually, the cost does not exceed 100 euros.
- If you get help from an accountant, the cost can be higher and change from one accountant to another. In this case, it is better to ask for an estimated cost first (preventivo) before receiving the service.
- If you do it yourself on the Agenzia delle Entrate website, you don’t pay.
Which is the right template (modello)?
When filing taxes, there are specific templates to be filled in (also called modello). The document depends on the type of income you received in the year of the declaration.
- Modello Redditi Persone fisiche is a model that allows you to submit multiple tax declarations. For example, you need to use this template if you have a partita IVA (VAT number) and you need to submit both dichiarazione dei redditi and dichiarazione IVA.
- Modello 730. Use this template if you are an employee (you have an employee contract) and you are resident in Italy. This is also the most used template for tax returns. Read more on this page.
What are the deadlines for the tax return?
The dates change every year. For 2021, the deadlines are:
- Modello 730 to be sent by 2 October 2023, online or by going to a Tax Assistance Center (CAF) or an accountant (commercialista).
- Modello Redditi Persone Fisiche to be sent by 30 November 2023, online or by going to a Tax Assistance Center (Caf), or an accountant.