Property

Cedolare Secca in Italy: Flat Tax or Ordinary Tax on Rent?

How cedolare secca works for rent in Italy: who can choose it, the 21 and 10 per cent rates, what it replaces, a worked comparison with ordinary tax, and how to pay.

October 30, 2026 · 7 min read

Cedolare secca is an optional flat tax on rent from homes in Italy. If you own a home and rent it out for residential use, you can pay a fixed 21 per cent of the yearly rent, or 10 per cent for some agreed-rent contracts, instead of adding the rent to your other income and paying progressive income tax. For many owners the flat tax costs less, but not for all.

This article explains who can use cedolare secca, what it replaces, the rates, a worked comparison with ordinary taxation, and how to choose it and pay. It is general information about Italian rules, not personal tax advice. Rules, rates and thresholds are Italian and change over time. Check your case with a CAF or an accountant (commercialista).

What cedolare secca is, and what it replaces

According to the Agenzia delle Entrate, cedolare secca is an optional regime. You pay a substitute tax in place of IRPEF (the Italian personal income tax) and its regional and municipal surcharges, for the part of your income that comes from the rented property.

It also removes two other costs. For a contract under cedolare secca, registration tax and stamp duty are not due when the contract is registered, extended or ended. The Agenzia notes that cedolare secca does not replace the registration tax for the transfer of a lease to another person.

The rent taxed under cedolare secca is excluded from your total income. You cannot deduct expenses or claim tax credits against it. The Agenzia also says that this income still counts for rules that depend on income, such as the ISEE indicator and whether a family member is treated as a dependant.

Who can choose it and for which rents

The option is open to individuals who own the property, or hold a right such as usufruct, and who do not rent it out as part of a business or a profession. The tenant cannot be acting in a business or as a self-employed person either, even if the tenant later lets an employee live in the home.

It applies to homes in cadastral categories A/1 to A/11, except A/10 (offices), rented for residential use, and to their annexes rented together with the home. If a property has several co-owners, each one chooses separately. A co-owner who does not opt in pays registration tax on their share of the rent.

The Agenzia page also describes a one-off rule for shops in category C/1 for contracts signed in 2019. This article does not cover it.

The rates: 21 per cent, 10 per cent and short lets

The Agenzia delle Entrate gives these rates:

21 per cent of the yearly rent agreed by the parties. This is the standard rate.
10 per cent for agreed-rent contracts (canone concordato) on homes in municipalities with housing shortages. The Agenzia names Bari, Bologna, Catania, Florence, Genoa, Milan, Naples, Palermo, Rome, Turin and Venice, the municipalities next to them, the other provincial capitals, and the municipalities of high housing tension identified by the CIPE. The Agenzia page lists only these municipalities, so check with a CAF whether a home elsewhere qualifies.
Short lets (contracts of up to 30 days): the rate is 21 per cent on one property you choose in your tax return, and 26 per cent on the second. From the 2026 tax year, cedolare secca for short lets applies only if you use no more than two apartments for this in the year.

The tax is calculated on the full rent in the contract. According to MoneIT's methodology page, the 5 per cent flat reduction of ordinary taxation is not applied.

What you give up

The cost of the option is not only the rate. By choosing cedolare secca you give up the right to ask for any update of the rent for the whole period of the option. This includes the ISTAT update for inflation, even if the contract provides for it. You must tell the tenant by registered letter before you opt in. The Agenzia says this notice is mandatory. It is not required for contracts that last less than 30 days in the year, or where the contract expressly waives updates.

You can choose cedolare secca when you register the contract or in later years. In later years you must choose within 30 days of the end of the previous contract year. You can also cancel the option in any later year, within the same 30 days. If you cancel, registration tax becomes due again.

A worked comparison with ordinary taxation

Under ordinary taxation, the rent is added to your other income. According to MoneIT's methodology page (which cites TUIR article 37 and DPR 131/1986), the rent is first reduced by a 5 per cent flat amount, then taxed with the IRPEF rates and the regional and municipal surcharges. Registration tax of 2 per cent of the yearly rent is also due on the contract, split in half with the tenant. I did not open those two laws myself.

The IRPEF brackets for 2026, from the Agenzia delle Entrate, are 23 per cent up to €28,000, 33 per cent from €28,001 to €50,000 and 43 per cent above €50,000. The Agenzia notes that the 2026 budget law lowered the second rate from 35 to 33 per cent.

The example below uses the numbers on the MoneIT calculator page. An owner rents a home for €800 a month for 12 months with a free-market contract, has other taxable income of €25,000 a year, and the surcharges are 2 per cent.

| Item | Cedolare secca | Ordinary taxation | |---|---|---| | Yearly rent | €9,600.00 | €9,600.00 | | Taxable amount | €9,600.00 | €9,120.00 (95 per cent) | | Income tax | €2,016.00 (21 per cent) | €2,709.60 | | Surcharges | none | €182.40 | | Registration tax, owner's share | none | €96.00 | | Total tax | €2,016.00 | €2,988.00 | | Left after tax | €7,584.00 | €6,612.00 |

How the €2,709.60 comes out: the first €3,000 of the rent fills the 23 per cent bracket up to €28,000 (€690.00). The other €6,120 falls into the 33 per cent bracket (€2,019.60). In this example cedolare secca costs €972 less per year, or €81 per month.

Your numbers will differ. The higher your other income, the higher the bracket the rent falls into, and the larger the difference. The comparison also leaves out personal tax credits, such as those for employment, pensions or dependants. With a low total income, these can cut the ordinary tax a lot, so ordinary taxation can be cheaper than the example suggests. A CAF can check this with your full tax situation.

How to choose it and how to pay

Notify the tenant. Send a registered letter saying you choose cedolare secca and give up rent updates, before you opt in.
Choose the option with form RLI. Use it when you register the contract, or in later years within 30 days of the end of the previous contract year. You can file it online with the Agenzia's RLI software or at the office where the contract was registered.
Pay with form F24. The tax codes are 1840 for the first advance payment, 1841 for the second advance payment or a single advance payment, and 1842 for the balance.
Follow the dates. The balance is due by 30 June of the following year, or by 30 July with an extra 0.40 per cent. The advance is 100 per cent of the tax due for the previous year, normally not paid in the first year of the option. It is due by 30 June and 30 November, in two parts of 40 and 60 per cent when it exceeds €257.52, or in one payment by 30 November when it is lower. No advance is due if the previous year's tax was €51.65 or less.

A free calculator for your numbers

MoneIT: cedolare secca or ordinary taxation. The calculator is free, needs no registration and its page is in Italian. You enter the contract type, rent, months rented, other taxable income, ownership share and surcharge rate, and it shows the tax under both regimes and the amount left after tax. It does not apply personal tax credits and does not include stamp duty.

Checklist

Check that you are an individual owner (or holder of a right such as usufruct) renting a home for residential use, not as a business.
Check the rate: 21 per cent, or 10 per cent only for an agreed-rent contract in a listed municipality.
Compare the two regimes with your other income. Ask a CAF about your tax credits.
Accept that the rent cannot be updated for the whole option.
Send the registered letter to the tenant, then file form RLI in time.
Pay with F24 (1840, 1841, 1842) and keep the receipts.

For Italy's municipal property tax on the same home, see How to Calculate IMU Tax in Italy.

Frequently asked questions

What is cedolare secca in Italy?

It is an optional regime for the owner of a home rented out for residential use. The owner pays a substitute tax at a fixed rate on the yearly rent. It replaces IRPEF and the surcharges on that rent, and registration tax and stamp duty are not due on the contract.

What are the cedolare secca rates?

According to the Agenzia delle Entrate, the rate is 21 per cent of the yearly rent. A 10 per cent rate applies to agreed-rent contracts (canone concordato) for homes in the municipalities with housing shortages listed by the law. For short lets, the rate is 21 per cent on one property chosen by the owner and 26 per cent on the second.

Who can choose cedolare secca?

Individuals who own the property, or hold a right such as usufruct, and who do not rent it out as part of a business or profession. The tenant also cannot be renting in the course of a business or self-employed activity.

Can I raise the rent with cedolare secca?

No. Choosing it means giving up the right to ask for an update of the rent for the whole period of the option, including the ISTAT update, even if the contract provides for it. You must tell the tenant by registered letter before you opt in.

When do I pay cedolare secca?

The balance is due by 30 June of the following year, or by 30 July with an extra 0.40 per cent. Advance payments are due by 30 June and 30 November, and normally there is no advance in the first year. You pay with form F24, using codes 1840, 1841 and 1842.