One euro of salary costs an employed freelancer €4,925.50

A designer on a Milan payroll who also invoices two clients of her own is not free to choose how that side income is taxed. If her employment income last year came to €35,000.01 rather than €35,000, she cannot use Italy’s flat-rate regime for the whole of this year. On €20,000 of side billing the euro costs her €4,925.50.12

That is the difference between two years that are identical in every other way — same job, same salary, same clients, same invoices. One is taxed at 15% of a presumed share of turnover; the other lands on top of the salary and is taxed at the rate the salary already reached.

The rule, and the number that is not in it

Article 1, comma 57, lettera d-ter) of L. 190/2014 shuts the flat-rate regime to anyone who in the previous year received employment or assimilated income eccedenti a stated amount. Three things about it decide who it catches.1

It looks back a year, so by the time a December bonus is paid the following year’s regime is already settled and nothing can be done about it. It is measured on the taxable employment income of TUIR articles 49 and 50, which under article 51, comma 2, lettera a) is already net of compulsory social contributions — not on gross pay, which for most employees is the larger figure.3 And the letter’s closing clause makes the test irrelevant where the employment relationship has ended, so it bites on people who still have the job.

The amount written in that letter is €30,000. It has read €30,000 in every version in force since the letter first appeared: the block of L. 190/2014 fetched at 1 January of each year from 2019 to 2026 has no d-ter at all in 2019 and €30,000 in every year after it, 2025 and 2026 included.1

The amount that actually applies in 2026 is €35,000, and it lives somewhere else. Comma 12 of article 1 of L. 207/2024 reads, in the text in force today, “Per gli anni 2025 e 2026, il limite di cui all’articolo 1, comma 57, lettera d-ter), della legge 23 dicembre 2014, n. 190, è elevato a 35.000 euro”. It never amends the letter, which is why reading the flat-tax law gives the wrong number.2

What the euro costs

Take the two years side by side at the bar: €35,000 of taxable employment income and €20,000 billed by a professional practice on the 78% coefficient, with no deductible costs.

Inside the regime the practice is taxed on €15,600 — turnover times the coefficient — less the €3,744.00 of Gestione separata contribution that comma 64 allows against it, at 15%. Outside it, the full €20,000 less the €4,800.00 of contribution is added to the salary, where the second IRPEF band has already been reached, and taxed at 33% and then 43%, with the regional and municipal surcharges the substitute tax would have replaced.456

The contribution runs at 24% on both sides. That is the rate L. 247/2007 fixes for Gestione separata members who are already insured under another compulsory scheme, which an employee always is; the additional rate that funds maternity and hospital-stay cover is charged by L. 449/1997 only on members who are not.78

The gap is €4,925.50, a quarter of everything the side practice billed. Of it, €1,056.00 is extra pension contribution, which buys something; €3,869.50 is tax, which does not.

Measured against the same salary with no side practice at all, which would carry €7,538.26 for the year, the €20,000 of side billing costs €7,241.70 inside the regime and €12,167.20 outside it — 36.2% of what was billed against 60.8%.

The gap is not an artefact of standing exactly at the bar. Recomputed at every €1,000 of employment income from €28,000 to €50,000, it runs between €4,922.88 and €6,152.56. Nor is it an artefact of the 78% coefficient, the most profitable of the six: across all of Allegato 4 it runs from €4,253.48 at 86% to €8,117.27 at 40%.

Where the gap closes

One thing does move it, and it moves it a long way. The flat-rate regime ignores real business costs entirely — the coefficient is the allowance — while ordinary rules deduct them in full. So the more a side practice actually spends, the less exclusion costs it.

On the same €20,000 of billing the gap falls to €3,775.40 at costs of 10% of turnover, €2,628.12 at 20%, €1,480.64 at 30% and €333.16 at 40%. It closes at 42.9%, about €8,581 of real costs on €20,000 billed. Above that line the person kept out of the regime is better off.

The detrazione that goes either way

There is a second charge, and it falls on both sides. Comma 75 of the same 2015 law says that where a provision tests income to grant or size a deduction, a detrazione or a benefit of any kind, flat-rate income counts.10 The employee detrazione of TUIR article 13 — a credit that comes off the tax bill rather than off the income — and the further one added by L. 207/2024 are both sized on reddito complessivo, the person’s total income for the year, so both shrink when a side practice is opened even though the regime taxes that income separately.1112

On the worked case the salary alone would carry €1,992.24 of detrazioni. Adding the flat-rate practice takes them to €272.94 — €1,719.30 gone, inside the regime, before exclusion is in the picture at all. Exclusion then takes the remaining €272.94, which is why the detrazioni account for only 5.5% of the €4,925.50 gap: almost all of it is the rate and the contribution base, not the taper.

The bar is written one year at a time

The €35,000 is not a settled figure. Fetched from Normattiva at 1 January 2025, comma 12 of L. 207/2024 read “Per l’anno 2025”. Fetched today, it reads “Per gli anni 2025 e 2026”. The lift was legislated for one year and later extended by one more.2

It says nothing about 2027. Unless it is extended again, the figure that governs is the one the flat-tax law itself has carried since 2020: €30,000. Whether that lands on income already earned depends on which year the phrase attaches to, and the provision does not say; what is certain is that the €35,000 has to be re-enacted to survive, and that the test it belongs to always looks at a year that is already over.

This is the same pattern the flat tax has shown throughout — fifteen rulebooks in twelve years, a median of 185 days apart, counted separately.

What this does not price

Three things are left out, and they do not all point the same way. A practice outside the regime charges and remits VAT, which is a cost to a client who cannot recover it and a burden on the person either way; it also keeps fuller records, which is usually a fee to an accountant. Both make exclusion worse than the figures above. Against that, the larger contribution buys a larger pension, so €1,056.00 of the gap is deferred rather than spent.

The regional and municipal surcharges are held at 2.23% on both sides. At the ends of the statutory range the gap is €4,692.94 and €5,092.70, so where the person lives moves it by a few hundred euros and not by the finding.13 And the whole comparison assumes the ordinary and flat-rate years are otherwise identical, which is the only way a single euro of salary can be made to carry the whole difference.