In depth
Social security discounts for companies hiring in the South
For the years 2025-2029, small and medium-sized companies hiring employees in Southern Italy will benefit from certain social security discounts for newly hired employees. However, employers will still be required to pay mandatory insurance premiums for these employees.
Social security discounts for working mothers
Starting in 2025, companies that employ or engage women employees or independent contractors with at least two children and a yearly taxable income of up to EUR 40,000 will benefit from certain social security discounts.
Parental leave
Parents will be entitled to a parental leave indemnity equal to 80% of their normal salary for up to three months if they take voluntary parental leave up until their child turns age six.
House rent bonuses for new hires
Employers can pay bonuses to employees hired with an open-ended contract in 2025 to cover their house rent. These bonuses will not be subject to personal income tax for the first two years of employment, with a maximum cap of EUR 5,000 per year. This tax exemption only applies to employees who (i) had a taxable work income below EUR 35,000 in the year prior to hiring and (ii) moved their address of residence to a new city more than 100 km away from where they previously lived.
Tax discounts on company performance bonuses
If an employer has a gainsharing scheme in place, the relevant sums paid in 2025, 2026 and 2027 will be subject to a flat tax rate of 5%, down from the previous rate of 10%. This tax discount will be granted provided that employees do not have a taxable work income higher than EUR 80,000 in the relevant tax period and only for performance bonuses not exceeding EUR 3,000.
Company welfare
For the years 2025-2027, sums paid or reimbursed to employees for water, electricity and gas bills, house rent, mortgages and other welfare services will not be subject to income tax up to EUR 1,000 per year. The threshold is set at EUR 2,000 per year for employees with fiscally dependent children.
New requirements to access unemployment benefits
Employees who resign or mutually terminate their employment and are hired within 12 months by another employer will not be eligible for unemployment benefits if they are dismissed by the new employer before completing at least 13 weeks of employment.
