Accounts in Italy
Every kind of account and pension the planner offers in Italy: what each one is, when money can come out, how it is taxed, and the pages we read the rules from.
Most Italian retirement income is the state pension from INPS or a professional fund. Savings sit in investment accounts, life insurance policies, postal savings bonds and deposits, and the one tax-favoured retirement product is the complementary pension fund (fondo pensione). The money step offers two rows: the ordinary account and the fondo pensione.
Severance pay (TFR) left with your employer is paid out when you stop working, so it is a one-off sum rather than an account. An annuity from a fund or an insurer goes in the pension step.
Rules as of the 2026 tax year, read from the authorities on 2026-07-27. Each account lists the pages we read it from.
Accounts you can enter
Investment account
Nothing is due while an accumulating fund grows, and profit is taxed at a flat rate when you sell. Government bonds are taxed at less than half the normal rate.
Funds, ETFs, shares and bonds held at a bank or broker. Nothing is due while a fund that reinvests its income grows, and the profit is taxed at 26% when you sell. Government bonds are taxed at 12.5%, which is why the money step asks what bonds you hold. A yearly stamp duty (imposta di bollo) of 0.2% of the account's value is charged on top.
How it is taxed, rate by rate, is on the tax page.
- In the withdrawal orders
- With the ordinary accounts
- Pays out
- Whenever you like
- At the first death
- Your partner takes it over, and the gain built up in it is wiped for tax
Fondo pensione
Nothing comes out before your state pension and five years of membership, unless you ask for RITA. The fund pays 20% on what it earns each year. What you deducted is taxed when it comes out, at 15% falling to 9% with your years of membership. A public-sector fund works the same way. If the rest will be a pension for life, enter only the lump-sum part here and the pension with your pensions.
A fondo pensione is Italy's complementary pension: a closed fund through your work or sector, an open fund, or a pension insurance plan (PIP). Contributions you deducted from your income, and the severance pay (TFR) you sent into it, were never taxed.
While it is held, the fund pays 20% on each year's result, counting gains not yet sold, and carries a loss forward. The plan charges that from inside the fund. That result is then already taxed, so only the deducted contributions and TFR are taxed on the way out: 15%, less 0.30 points for each year of membership past 15, down to 9% after 35 years, apart from your income tax. That is why the planner asks your years of membership and the share you deducted.
It opens at the later of your state pension age and five years of membership. Then you can take up to half as a lump, which goes into your ordinary account, or all of it if the pot is small. The rest pays out in the form you choose: an income for life (enter it in the pension step, and only the lump part here), an income spread over your life expectancy, free withdrawals no faster than that, or instalments over at least five years, taxed at 20% falling to 15%. Instalments are open from 31 October 2026, and the plan starts them from 2027.
If you have stopped working, you can ask to draw the fund early as an income in the years before your state pension (RITA). The plan does this only if you say yes. It treats all of the money as paid in from 2007 under today's rules, and never takes an advance or a surrender.
- In the withdrawal orders
- With the accounts taxed on the way out
- Before the earliest age
- Nothing comes out before the age the law sets for it
- Taxed while you hold it
- Yes, paid from inside the account
- At the first death
- Your partner takes it over as it stands
- Years you have been a member From 0 to 70 years. No default: you answer it.
- Share you deducted, with your TFR From 0% to 100%. We assume 100%.
- How you will take the rest We assume: a pension for life (enter it with your pensions).
- Share taken as a lump sum From 0% to 50%. No default: you answer it.
- Years it pays over From 1 to 50 years. No default: you answer it.
- Years of instalments From 5 to 50 years. No default: you answer it.
- Start it early (RITA) We assume: no.
An Italian complementary pension fund pays 20 percent every year on what it earned, counting gains it has not sold, and carries a loss to later years. We charge that, but at 20 percent on everything: the part of the fund's result that comes from government bonds really pays 12.5 percent. With a fund that holds a lot of government bonds, the tax we show is a little too high.
Your real tax is lower/anyone whose Italian complementary pension fund holds government bonds
We model an Italian complementary pension fund's payout: the exit tax falling with your years of membership, the capital you take at the pension age (at most half, or all of a small pot), and the rest paid as a term annuity, free withdrawals or instalments over the years you choose. Some of it is simplified. Unless you choose another payout form, we pay the whole fund as capital at the pension age and leave any annuity to the pension you enter yourself, so a large fund with no annuity entered reaches you sooner than the law allows: it caps the capital at half. We treat all the money as paid in from 2007, we never take an advance or a surrender, a small pot is judged with the state scheme's conversion rate, and the instalments option starts from 2027.
Could go either way/anyone with an Italian complementary pension fund, especially with money paid in before 2007
- Ministero del Lavoro e delle Politiche Sociali: Previdenza complementare: le novità della legge di bilancio 2026 in vigore dal primo luglio 2026 (read 2026-10-07)
- Normattiva: D.lgs. 252/2005, art. 11: Prestazioni (read 2026-10-07)
- Normattiva: D.lgs. 252/2005, art. 17: Regime tributario delle forme pensionistiche complementari (read 2026-10-07)
- Agenzia delle Entrate: Circolare n. 70/E del 18 dicembre 2007: previdenza complementare (read 2026-10-07)
The law behind it
Kinds of pension
A pension paid to you as an income goes in the pension step, not here. Choose its kind there and the plan taxes it by that kind's rules; leave it on standard and it is taxed like a state or workplace pension.
Pension fund annuity built up before 2001
87.5% of each payment is taxed as income.
The part of a fund's life annuity that comes from money built up before 2001 is taxed under the old rules: 87.5% of it as income, on the income scale with the regional and local taxes. The part built up later is taxed differently and has no kind of its own yet, so enter it as a separate pension, after tax.
Italy gives a pension fund annuity the larger tax credit meant for wages, not the smaller one for state pensions. We give every pension the state pension credit. If a fund annuity is your only pension, we show up to about 1,560 a year more tax than you pay.
Your real tax is lower/up to €1,563 a year/anyone whose pension comes from an Italian pension fund or insurer annuity rather than from INPS
Part of an older member's pension fund annuity, the part built up between 2001 and 2006, is taxed as ordinary income but only on what was not already taxed inside the fund or paid from money you never deducted. That share differs for every member, and we have no place to enter it, so we tax all of that part.
Your real tax is lower/members of an Italian pension fund who joined before 2007 and take an annuity
- Agenzia delle Entrate: Circolare n. 70/E del 18 dicembre 2007: previdenza complementare (read 2026-10-07)
- Normattiva: D.lgs. 252/2005, art. 23: Entrata in vigore e norme transitorie (read 2026-10-07)
The law behind it
Where other things you hold go
- Severance pay (TFR) left with your employer
- Enter what you will receive as a one-off lump in the year you stop working, after tax.
- Life insurance policies (polizze vita) and long-term savings plans (PIR)
- Enter them in the ordinary account. A policy's growth is taxed at 26% when you cash it in, much as a fund's. A PIR held five years is free of tax, and a traditional policy pays no stamp duty, so for those we show too much.
- Postal savings bonds (buoni fruttiferi postali)
- Enter them in the ordinary account and choose a fund holding only government bonds for them. Like those funds, they are taxed at 12.5% on the interest when you cash them in.
- An annuity from a fund built up after 2000, or one bought from an insurer
- Enter it in the pension step after tax. Only part of each payment is taxed, at a flat rate, and as a standard pension it would be taxed in full on your income scale.
- INPS or professional fund pension
- Enter it in the pension step as a standard pension.