Italy allows tax deductions for foreign social security contributions

Italian tax residents who work abroad can now deduct mandatory social security contributions from their taxes. This clarification comes from the Agenzia delle Entrate in response to inquiry n. 5/2026, following rulings from the Court of Cassation (17747/2024 and 9092/2025) that distinguished between income and charges.

The regulation applies to individuals who work continuously outside of Italy as their exclusive professional activity while maintaining fiscal residence in Italy, specifically those spending more than 183 days abroad within a 12-month period. Under Article 51, paragraph 8-bis of the TUIR, these workers are subject to conventional remuneration rules, where tax is calculated based on fixed annual tables rather than actual salary.

To claim these deductions, taxpayers must include the contributions in line E21 of the 730 or Redditi model and provide mandatory documentation, including employer certification and original payslips.