How Italian VAT is calculated
To add VAT, multiply the net amount by the rate: €1,000 at 22% gives €220 of tax and a total of €1,220.
To remove it, divide the total by 1 plus the rate: €1,220 divided by 1.22 gives €1,000 net. Taking 22% off the total is the most common mistake: €1,220 less 22% is €951.60, not €1,000.
VAT rates in Italy
Italy has four rates. The rate depends on the goods or the service, not on who sells it.
- 22%: the standard rate, for everything outside the reduced rates.
- 10%: restaurants and hotels, some food, household energy, many building renovation works.
- 5%: some health and social care services from social cooperatives and a few other goods named in the law.
- 4%: basic food such as bread, milk, fruit and vegetables, books and newspapers, a first home bought from a company.
When VAT is not charged
Freelancers in the flat-rate regime (regime forfettario) do not charge VAT and say so on the invoice. Occasional work without a VAT number is outside the tax. Other transactions are exempt or zero-rated by law, such as many health services and exports.
Frequently asked questions
Divide the price including VAT by 1.22. The result is the net amount; the difference from the price is the VAT. On €100 the net amount is €81.97 and the VAT is €18.03.
IVA (imposta sul valore aggiunto) is Italian value added tax. It is charged on most goods and services and shown separately on invoices.
The imponibile is the price before tax, the amount VAT is calculated on. The totale is what the customer pays: net amount plus VAT.
No. Under the regime forfettario invoices are issued without VAT, and VAT paid on purchases cannot be deducted.
Sources and method
Figures and rules checked on . The result is an estimate for information and does not replace professional advice.