Employee benefits
Night, holiday and shift pay: Italy’s 15% tax in 2026
Employee benefits · · 2 min read
By Lorenzo Schiavone · calculator developer
In 2026 qualifying private-sector night, holiday and shift payments can use a 15% substitute tax instead of ordinary IRPEF and local taxes. The annual cap is €1,500 taxable pay after employee contributions, and 2025 employment income must not exceed €40,000.
Eligibility and written opt-out
The relevant premiums and allowances must be provided by the collective agreement applied to the employment relationship. On-call allowances can qualify even when no work call occurs.
The measure applies unless the worker opts out in writing. Tourism, thermal establishments and food-service sectors covered by the separate special supplementary allowance are excluded. Amounts cannot receive another substitute-tax benefit at the same time.
Night or holiday overtime can qualify
Revenue Agency circular 3/E of 24 June 2026 clarifies that eligible night or holiday overtime can qualify for its entire remuneration, rather than just the premium. Ordinary daytime overtime does not qualify merely because it is overtime.
Additional part-time hours also need the specific qualifying conditions. Pay above the annual taxable cap stays ordinarily taxed. For inbound workers, the entire substitute-taxed slice after contributions is taxed, without a second impatriati exemption.
An example and calculator inputs
With €1,000 gross eligible pay and only 9.19% IVS, contributions are €91.90 and the substitute-tax base is €908.10. Tax at 15% is €136.22, leaving about €771.88 before other annual effects.
Enter the eligible annual gross amount as a distinct portion already inside RAL, along with previous-year income and confirmed eligibility. Do not add it again as an extra bonus. The engine allocates annual contributions proportionally; actual payroll allocation may differ.
The slice leaves ordinary taxable income and ordinary income-based relief. It is restored separately for the virtual employment-tax capacity test for the trattamento integrativo. Compare complete ordinary and substitute-tax outcomes before choosing an opt-out.
Frequently asked questions
Is all overtime excluded? ▾
No. Eligible night or holiday overtime can qualify in full. Ordinary daytime overtime does not qualify solely as overtime.
Is written acceptance required by default? ▾
The employer applies the measure when conditions are met, unless the worker renounces it in writing. The simulator needs an explicit eligibility confirmation.
Sources and method
- Agenzia delle Entrate · circular 3/E · 24 June 2026
- Agenzia delle Entrate · circular 2/E · 24 February 2026
- Ministry of Labour · 2026 budget measures
- QuantoNetto · calculation method and limitations
An informational guide to the 2026 rules. Examples are annual estimates under the stated assumptions. Average pay does not reproduce a monthly payslip. Prior-year municipal rates are marked as estimates.