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Freelance or employee: Which is the best way to work in Italy?

Wondering how you can secure work in Italy? We weigh up the pros and cons of going self-employed or being on the payroll.

The city of Milan is the top destination for foreigners seeking work in Italy.
The city of Milan is the top destination for foreigners looking for work in Italy. Photo by Ouael Ben Salah on Unsplash

Moving in Italy is the dream for many, but it probably involves finding a way to support yourself financially.

Italy doesn’t have the best reputation for employment opportunities, and the Covid-19 pandemic hasn’t helped: unemployment has risen and the country reported its biggest shrinkage in GDP since the end of World War II.

But that doesn’t mean it’s impossible to find work here – particularly if you have relevant skills and experience.

And for foreign nationals moving to Italy, there are some financial advantages.

READ ALSO: The 25 most in-demand jobs and skills in Italy in 2022

“Contrary to popular belief, this is a good time to move to Italy for work,” said tax and finance expert Nicolò Bolla of Accounting Bolla

“There are tax deductions for newcomers to the country, meaning that if you’re smart enough, you could find a position that allows you to enjoy the Italian lifestyle and bring in more income.”

So when planning your move, which type of employment should you look at?

In tumultuous times, it may be tempting to go down the employed route for security. But it’s not that black and white – and choosing one path doesn’t preclude you from changing your mind later.

“You can be flexible. If you come to Italy as a freelancer, you can then become an employee and vice versa,” Bolla said.

The first questions you should ask yourself

Your country of origin is the jumping-off point. EU nationals can stay and work in Italy with a much more straightforward set of rules, whereas non-EU citizens have plenty more bureaucratic hoops to jump through.

Since Britain left the EU this year, Brits are now counted as third country nationals, along with Americans and Candians, for example. This means the benefits of free movement to live and work across Europe are now lost.

Once you’ve taken into account where you are coming from and the paperwork that implies, where do you start?

Choosing self-employment or employment can depend on your qualifications, experience and field of work.

READ ALSO: ‘Smart working’? Here’s what you need to know about going self-employed in Italy

Photo: Andreas Solaro/AFP

“If you have a college degree or a Masters degree, it’s usually better to come to Italy as an employee. You’re more likely to get hired, which can give you an ‘in’, an entry to living here,” stated Bolla.

It’s also more probable you’ll get a job this way from a statistical point of view. Italy has an annual quota for how many people can enter the country to work under the so-called Decreto Flussi (Flow Decree).

Each year, this caps the number of workers coming from outside the EEA. For 2022, the government set the limit at 69,700 – more than double the number allowed in previous years in total.

However, the number of permits available also depends on the type of work you plan to do. Out of that overall figure, there’s an allowance for just 500 self-employed workers, a figure which remains unchanged on previous years.

READ ALSO: How many people does Italy grant work permits to every year?

This means competition is high, and gaining a self-employment visa – which allows you to come to Italy as a freelancer – has one of the highest rejection rates.

“You have a lower chance of being turned down as an employee. Given that getting a self-employment visa is hotly vyed for and you have to prove your work history, as well as have a cash back-up, this route is harder than employment,” Bolla advised.

The annual cap on working in Italy might not apply to you

However, it’s not the same story for all careers. There are some categories of professionals who fall outside of this bracket and are not subject to a fixed allowance.

“There’s a limit on mid-level workers and seasonal workers, but there is no quota for highly-skilled professionals with a degree,” added Bolla.

Often referred to simply as ‘Article 27’, this section of European law provides an exemption for non-EU workers who fall outside of national quotas within the EU.

ICT workers, highly skilled executives or managerial employees working in the Italian branch of a foreign legal firm, artists, journalists, university lecturers and professors, translators, interpreters and nurses are some of the occupations excluded from the cap.

Instead of being subject to the annual competition, these highly qualified individuals can apply for the EU’s Blue Card.

To be eligible, you must have secured a work contract of at least one year, have a minimum gross salary of €24,789.93 per year and have documentation of your qualifications.

The processing time for getting one of these cards is up to 90 days and costs €100. 

Details of which category you might fall into are detailed on the EU’s immigration portal.

Working for a company doesn’t get you off the administrative hook

If you don’t qualify for a Blue Card and think you can clinch one of the annual employment spots granted by the Italian government, the onus is still on you to sort out your paperwork and you cannot rely solely on your employer.

“Companies might hold your hand through the bureaucracy and may even offer you a relocation package, but it is still the responsibility of the employee to get their papers in order. That means organising a work visa and proving you have a place of accommodation,” warned Bolla.

A work visa is a kind of Italian Long Stay visa and to get that, you need a work permit. This is called a Nulla Osta, which your Italian employer has to apply for at their local Immigration Office (Sportello Unico d’Immigrazione – SUI).

READ ALSO: What’s the difference between Italian residency and citizenship?

Once you get that from your employer, you can apply for the work visa in your home country at your consulate. From there, you have the ability to enter Italy, but still need to apply for an Italian residence permit within 8 days of arriving in Italy. The permesso di soggiorno is the documentation that allows you to legally live and work in the country.

Further to this, there’s more administration to be done in Italy, which depends on the country you’re coming from and your specific circumstances.

How can you do this if you’re not in the country? Bolla advises getting a proxy, such as an accountant or lawyer, who can navigate the system for you: “You need to provide the power of attorney to someone in Italy, who can deal with the paperwork for you and gather all the relevant documents, thereby representing you and acting on your behalf.”

Some of this documentation could include:

  • Copy of your signed work contract.
  • The original and a copy of your Nulla Osta.
  • Diplomas/certificates
  • Completed Long-Stay visa application
  • Passport with at least two blank pages, valid for at least three months after the duration of your visa.
  • Passport pictures
  • Proof of accommodation in Italy
  • Proof of sufficient funds

The Italian Ministry of Foreign Affairs has an updated visa portal to check what you might need, depending on your country of origin – the Italian authorities could ask you for any documentation they deem necessary.

Of course, it is allowed and possible for you to handle the paperwork yourself if you spend some time in Italy as a tourist before you begin work – and if your Italian language skills are up to scratch.

“The problem with moving through Italian bureaucracy is the language. Immigration policies are tough the world over, but the particular hurdle in Italy is needing to go through everything in Italian,” Bolla said.

In other countries, there may be the option to apply in English, but that’s not the case in Italy.

He points out that this is “the bottom line”, adding that, “If you don’t speak Italian, you can’t figure it out. If there are translations on an immigration office’s website, it’s usually poor and doesn’t make sense.”

‘Going freelance isn’t as hard as people make out’

If taking the employed route seems overwhelming, surely the small national quota and paperwork involved must be even tougher if you want to be self-employed in Italy?

Since the pandemic catalysed a change in how Italians do business, moving jobs to a digital environment, now could be the ideal time to go freelance in Italy.

It might require persistence and patience, but it’s the preferred option for accountant Bolla: “I would rather freelance, as it’s easier to make more money,” he claimed.

“People make it seem harder than it is by saying becoming a freelancer in Italy is impossible. It isn’t,” he added.


Of course, how much money you make depends on your personal ambition and connections too.

However, a benefit of being self-employed is that there is no limit to your earning power. As an employee, on the other hand, you know what’s landing in your account every month – unless your wage fluctuates with commission.

There’s also a good degree of flexibility. If you’re self-employed, you can diversify your revenue streams. For example, you could work as a teacher by day and run an e-commerce site by night.

Bolla points out that all you need is a partita IVA (VAT number) and if you want to do different types of jobs, you have to log them under different income codes known as a ‘codice ATECO‘, which has to be communicated to the Revenue Agency (Agenzia delle Entrate).

You would also have to check your business activity is compliant with the law and may need to ask permission to trade from your local comune (Town Hall).

Being self-employed is also an opportunity to have clients in the U.S. or U.K. and receive a higher pay compared to Italy, according to Bolla.

“If you’re smart enough, you can get a higher, foreign wage, but live the Italian lifestyle,” he said.

There’s a double taxation agreement in place to ensure you don’t pay tax twice if you choose to work with international clients.

Photo: Luca Bravo/Unsplash

How taxation of employees and the self-employed compares

It’s undeniable that it’s more straightforward to be an employee, as your national security contributions, or INPS (Istituto nazionale della previdenza sociale’), and personal income tax known as ‘IRPEF’ are taken at source.

On the other hand, as a freelancer you have to put money aside for paying these yourself.

There’s also a little help from an employer with paying INPS – they stump up two-thirds of your social security contributions, with the remaining third coming from you. The self-employed are responsible for paying INPS solely.

READ ALSO: Working remotely from Italy: What are the rules for foreigners?

How much income tax you pay as an employee varies depending on your gross earnings, varying between 23% – 43%, according to the Agenzie delle Entrate.

As a new self-employed professional, on the other hand, you could set up under the so-called Forfettario regime, which means you pay 5% flat tax for five years. Italian authorities introduced this tax scheme in a bid to encourage new commercial activity from sole traders and small businesses.

It’s also worth remembering that as an employee, there are various deductions, such as health insurance if you work in a chemical plant, for instance. This changes according to the profession and there’s no one-size-fits-all answer.

Equally, there are professional liability insurances you may need to take out yourself if you go freelance.

Being an employee also grants you a bonus if and when you leave a position. TFR, Il Trattamento di Fine Rapporto (the Staff Severance Fund), pays out a lump sum when you finish a contract with an employer. It amounts to 6.91% of an annual salary and is calculated on the years and months of service, potentially making for a tidy sum if you change jobs.

Consider your personality as well as your paycheck

Beyond money, there’s also the matter of Italian business culture to take into account. 

“Culturally, Italy has always been a country that prefers certainty over risk, so people would rather be an employee than self-employed,” claimed Bolla.

“There isn’t a corporate mindset and it’s hard to climb the ladder. Large businesses are normally family-run and so family members are likely to get hired and promoted. This can be a problem for people coming from outside Italy,” he added.

READ ALSO: ‘It’s crazy’: What to expect when you work for an Italian company

“So the question is: ‘Can you work with Italians?’ If you can deal with a different work ethos and get culturally adjusted, it’s a great place for people to live,” said Bolla.

There are plenty of steps to take into account, whichever route to working in Italy you may plump for. But it’s not impossible. With time, organisation and a strong stomach for bureaucracy, you too could be living out your career goals in il bel paese.

This is an updated version of an article originally published in 2021.

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For members


EXPLAINED: What is Italy’s new digital invoicing rule for freelancers?

Italy is bringing in new rules from July that mean changes for freelancers on the 'flat tax' rate. Here’s what you need to know about the new ‘fatturazione elettronica’, or digital invoicing system.

EXPLAINED: What is Italy’s new digital invoicing rule for freelancers?

Italy has been slowly moving more of its bureaucratic systems online in recent years, and in many cases this has made it quicker and easier for residents to access services and get their considerable amounts of Italian life admin in order.

It was hoped that the new electronic invoicing rule would do the same for freelancers on Italy’s flat-tax regime, by doing away with the existing need to print out invoices and affix tax stamps by hand.

READ ALSO: Beat the queues: 19 bits of Italian bureaucracy you can do online

But a close look at the details of the new rules shows that it probably won’t make life easier for those on the flat tax rate, who have so far been spared the bulk of that infamous Italian red tape – but now need to get to grips with a new online system.

Known as the ‘regime forfettario‘, Italy’s flat-rate tax scheme for individuals and small businesses was introduced in 2015 to encourage more commercial activity by slashing tax rates and simplifying bureaucracy.

New freelancers who choose this tax system generally pay somewhere between just five and 15 percent tax on earnings, regardless of overheads.

READ ALSO: The pros and cons of Italy’s five percent flat tax for freelancers

Little has changed since its inception seven years ago, but freelancers using the scheme now need to be aware of new rules coming into force from July 1st, 2022.

How you invoice – how you send, receive and store receipts, therefore – is due to move from analogue to digital, bringing new requirements and know-how on digital invoicing software.

Here’s what’s changing for freelancers with the so-called ‘fattura elettronica‘.

Who is required to send electronic invoices?

While this was already a requirement for the self-employed on other tax regimes, those on the flat tax rate will now be included from July 1st.

They were previously exempt, but that changed under the PNRR (National recovery and resilience plan or piano nazionale di ripresa e resilienza) – the Italian government’s plan for using EU funding for post-pandemic economic recovery.

Digital invoicing is intended to fight Italy’s major problem with tax evasion, as well as to further automate accounting processes.

For now, not all freelancers under this tax scheme need to move to digital accounting – only those who received an income in excess of €25,000 in the previous year are required to comply with the new rule.

It will then extend to all freelancers using the flat-rate scheme from January 1st, 2024.

From that date, everyone subscribed to the ‘regime forfettario’ will have to switch to electronic invoicing and there are hefty penalties in place for those who don’t.

How will electronic invoices work?

Italy’s tax authority has defined a couple of notable differences between the digital or electronic invoice (fattura elettronica) and a paper invoice (fattura di carta) in its updated guidelines.

Firstly, the digital invoice has to be created using a digital device (a computer, tablet or smartphone), and secondly it has to be sent to the client via an ‘Interchange System’, the so-called Sistema di Interscambio (SdI).

READ ALSO: ‘Smart working’? Here’s what you need to know about going self-employed in Italy

Italy’s flat-rate tax scheme is going digital. Photo by Christian Dubovan on Unsplash

This electronic postal system checks whether the invoice contains the required data for tax purposes, as well as checking the verified e-address (or the so-called PEC address) of the recipient.

In doing so, the electronic invoice automatically checks that the VAT number (partita IVA), or the tax code (codice fiscale) depending on who you send the invoice to, really exist.

Once the checks are completed, the system sends the invoice to the client, which will trigger an alert to the freelancer with a delivery receipt, showing the date and time the document was delivered.

How can you send an e-invoice?

There are a few accounting software options on the market if you’re now faced with having to send electronic invoices.

Some charge a fee of around €1-€4 per month or come at a cost per transaction.

Platforms such as ‘Aruba‘ or ‘Fatture in Cloud‘, are competitive and may offer you a free trial before you deciding to buy.

The Italian revenue agency (Agenzie delle Entrate) has also created free-of-charge services to help send and receive e-invoices. These include websites as well as apps for completing the required steps, which are detailed in their guide here.

You can access their Invoices and Receipts (‘Fatture e Corrispettivi‘) portal to benefit from these free services.

You’ll either need a Spid ID (‘Sistema Pubblico dell’Identità Digitale‘), a Carta Nazionale dei Servizi (CNS) or accounting credentials known as Fisconline/Entrate, which are issued by the Agenzie delle Entrate.

You can also delegate this task to an intermediary, such as an accountant (commercialista) who would do this on your behalf, the revenue agency stipulates 

What about the Italian tax stamp?

Until now, freelancers issuing invoices under the ‘regime forfettario‘ have had to attach a €2 stamp, called a ‘marca da bollo’, to every invoice over the value of €77,47.

So what happens when e-receipts go digital and you can’t physically stick a stamp on a document? Well, that goes digital too and the Inland Revenue has issued a 16-page guide on how you need to go about it.

It seems the previously attractive ‘light’ accounting of this regime is about to get bogged down by time-consuming bureaucracy too.

Authorities will systematically check that the fee has been paid each quarter for all the invoices that require it.

As a general rule, you can see if there are any discrepancies by the 15th day of the first month following each quarter on their Invoices and Receipts portal.

You or your intermediary have until the end of that month to fix any accounting errors, but make sure to check with an accountant if you have any difficulties or need specific advice for your personal circumstances.

Once you receive your final stamp duty bill for each quarter, you can pay either via IBAN, which you set up on the portal, or by filling out an electronic F24 form – details of how to do that are included in the guide.

For further information and FAQ’s, see Italy’s Inland Revenue Agency website on the electronic invoice here.

Please note The Local cannot advise on personal cases and seeking expert financial advice is recommended.