Tax Observatory › Direct taxes and returns › Second IRPEF payment on account for 2026: with the rate cut to 33 per cent, the historical method may lead to overpaying

Second IRPEF payment on account for 2026: with the rate cut to 33 per cent, the historical method may lead to overpaying

Update. The deadline for handing the withholding agent the notice that reduces the second payment on account expired on Monday 12 October 2026. After that date the amount calculated in the 730 return is withheld; any excess is recovered in the return for 2026.

The second instalment of the 2026 payment on account of IRPEF, the Italian personal income tax, is due on 30 November 2026. Under the historical method the payment on account is based on the 2025 tax, calculated at the former 35 per cent rate, whereas the 2026 tax is already calculated at 33 per cent. For taxpayers with income above 28,000 euro, the forecast method can reduce the payment by up to 440 euro (the saving may be smaller, or nil, for total income above 200,000 euro), but it exposes them to penalties if the estimate proves too low. Taxpayers who have filed a 730 return (the simplified return for employees and pensioners) and wish to reduce the second payment on account must notify their withholding agent in writing by 12 October.

The second or single instalment of the IRPEF payment on account for 2026 is due on Monday 30 November 2026. This year the calculation should be checked. Since 1 January 2026 the rate for the second income bracket, above 28,000 and up to 50,000 euro, has fallen from 35 to 33 per cent. The law contains no rule requiring the payment on account to be calculated as if the reduction had not taken place. Taxpayers who use the historical method, however, start from the 2025 tax, calculated at 35 per cent. If income is unchanged, they therefore pay more on account than they will owe for 2026. The difference reaches 440 euro for taxable income of 50,000 euro or more, unless total income exceeds 200,000 euro, in which case the benefit is wholly or partly offset by a reduction in certain tax deductions (detrazioni). The forecast method avoids the overpayment, provided that the estimate is accurate.

The rules and the deadline

The IRPEF payment on account is governed by Article 1 of Law No 97 of 23 March 1977. Since the 2013 tax year its amount has been set at 100 per cent by Article 11(18) of Decree-Law No 76 of 28 June 2013. The split into two instalments is laid down in Article 17(3) of Presidential Decree No 435 of 7 December 2001: 40 per cent of the payment on account is paid with the first instalment, by the deadline for the balance, and 60 per cent in November. For taxpayers subject to the synthetic tax reliability indices (indici sintetici di affidabilità fiscale, ISA), and for their partners or shareholders, Article 58 of Decree-Law No 124 of 26 October 2019 instead provides for two instalments of 50 per cent each. Resolution No 93/E of 12 November 2019 of the Italian Revenue Agency (Agenzia delle entrate) clarified that the same split applies, whether or not the indices are actually applied, to taxpayers carrying on activities for which ISA have been approved and declaring revenue or fees not exceeding the threshold set for each index, including those under the flat-rate regime (regime forfetario) or the regime for young entrepreneurs (regime di vantaggio) and the other taxpayers excluded from the indices.

In 2026, 30 November falls on a Monday, so the deadline is not deferred. For taxpayers who file a 730 return naming a withholding agent (their employer or pension provider), the amount is withheld from their November salary or pension; taxpayers who file the Redditi return, or a 730 without a withholding agent, pay using the F24 payment form.

No payment on account is due if the 2025 tax, net of tax deductions, tax credits and amounts withheld, does not exceed 51.65 euro. If the first instalment does not exceed 103 euro, the whole payment on account is made in November: for taxpayers on the 40/60 split, this happens when the total payment on account is below 257.52 euro.

Why the historical method may cost more this year

Article 1(3) of Law No 199 of 30 December 2025 replaced the words ‘35 per cent’ with ‘33 per cent’ in Article 11(1)(b) of the Consolidated Income Tax Act (testo unico delle imposte sui redditi). For taxable income of 50,000 euro, gross tax falls from 14,140 to 13,700 euro. Above 50,000 euro the reduction remains 440 euro. For taxpayers with total income above 200,000 euro, however, paragraph 4 of the same Article reduces certain tax deductions by 440 euro, including the 19 per cent deductions other than those for medical expenses. For these taxpayers the benefit is wholly or partly offset, and whether the forecast method is worthwhile must be assessed case by case.

The legislature has used neutralisation clauses for payments on account before. Article 1(4) of Legislative Decree No 216 of 30 December 2023 required the payments on account for 2024 and 2025 to be calculated under the four-rate scale previously in force; Decree-Law No 55 of 23 April 2025, converted into law by Law No 86 of 19 June 2025, then confined that rule to the 2024 tax year. No similar provision exists for 2026: the 2026 Budget Law requires the payment on account to be recalculated only for other measures, and the instructions for the Redditi PF 2026 and 730/2026 returns mention no such recalculation linked to the new rate. The historical method therefore remains lawful, but its starting point is calculated at 35 per cent.

An example

A professional under the ordinary regime who invoices private clients, and is therefore not subject to withholding tax, declared taxable income of 45,000 euro for 2025 and expects the same income for 2026. For simplicity, it is assumed that there are no tax deductions or tax credits.

• 2025 tax, the basis of the historical method: 28,000 euro at 23 per cent (6,440 euro) plus 17,000 euro at 35 per cent (5,950 euro), totalling 12,390 euro.
• Estimated 2026 tax, the basis of the forecast method: 6,440 euro plus 17,000 euro at 33 per cent (5,610 euro), totalling 12,050 euro.
• Under the historical method the second instalment is 7,434 euro (12,390 euro less the first instalment of 4,956 euro already paid); under the forecast method it is 7,094 euro.

The payment is 340 euro lower. If the same professional were subject to the synthetic tax reliability indices, the first instalment would have been 6,195 euro and the second would fall from 6,195 to 5,855 euro. The advantage shrinks, and may disappear, if 2026 income rises: the forecast method is worthwhile only if the estimate reflects the actual trend in income for the year. For an employee who also has other income, the basis of the payment on account is the tax net of amounts withheld, and from 2026 the employer already withholds at 33 per cent. The saving equals 2 per cent of the income not subject to withholding, limited to the portion that, added to salary, falls within the 28,000–50,000 euro bracket.

The risk of the forecast method

A taxpayer who pays less on account than the historical method requires takes responsibility for the estimate. If the 2026 tax, as calculated in the return filed in 2027, turns out to be higher than expected, the payment on account may be insufficient. The payment on account due is in any case the lower of the amount calculated under the historical method and the amount based on the actual 2026 tax: the shortfall can therefore never exceed the difference between the historical payment on account and the amount paid. The shortfall attracts a penalty of 25 per cent of the unpaid amount, halved if payment is made no more than ninety days late. The penalty is laid down in Article 13(1) of Legislative Decree No 471 of 18 December 1997, as applicable to violations committed from 1 September 2024.

Article 4(2)(c) of Decree-Law No 69 of 2 March 1989 provides that no penalties or interest are charged on the second instalment if the total amount paid is not lower than the payment on account due on the basis of the return for the current year. The reference is to the actual 2026 tax: if the estimate turns out to be too low, this safe harbour does not apply.

The shortfall can be regularised through voluntary correction (ravvedimento operoso) under Article 13 of Legislative Decree No 472 of 18 December 1997, by paying the difference together with the reduced penalty and interest at the statutory rate, which has been 1.60 per cent a year since 1 January 2026. A taxpayer who regularises within fourteen days of the deadline pays a penalty of about 0.083 per cent for each day of delay; within thirty days, 1.25 per cent; between the thirty-first and the ninetieth day, about 1.39 per cent; after ninety days, and by the deadline for the return for 2026, 3.125 per cent. For the part of the delay falling in 2027, interest will be calculated at the statutory rate set for that year.

The 730 return: notifying the withholding agent

A taxpayer who has filed a 730 return and has not already reduced the payment on account by completing line F6 may ask the withholding agent not to withhold the second payment on account, or to withhold a lower amount. The request must be made in writing by 10 October, stating, on the taxpayer’s own responsibility, the amount considered due. In 2026 that day falls on a Saturday, and the Agenzia delle entrate calendar gives Monday 12 October as the last day; it is nonetheless prudent to hand in the notice by Friday 9 October and to keep proof of delivery. The same notice applies to the second payment on account of the cedolare secca, the flat tax on residential rental income, which is also due on 30 November. If the deadline is missed, the amount calculated in the 730 is withheld, and any excess is recovered in the following year’s return.

Set-off and special cases

The second instalment may be paid by setting off available tax and social security credits in the F24 form, under Article 17 of Legislative Decree No 241 of 9 July 1997. An IRPEF overpayment shown in the return may also be used directly to reduce the second instalment, under Article 4(3) of Decree-Law No 69 of 1989. Set-off in the F24 form is, however, barred, except for social security contribution and INAIL premium credits, if the taxpayer has overdue and unsuspended central government tax debts and related charges entrusted to the collection agent (ruoli or carichi affidati) totalling more than 50,000 euro, excluding amounts under instalment plans that have not lapsed, under Article 37(49-quinquies) of Decree-Law No 223 of 4 July 2006. The threshold was lowered to that amount by Article 1(116) of Law No 199 of 2025. To set off income tax credit balances exceeding 5,000 euro a year, the return from which they arise must carry a compliance endorsement (visto di conformità), as required by Article 1(574) of Law No 147 of 27 December 2013.

Unlike the balance and the first instalment, the second instalment cannot be spread over several payments: payment by instalments under Article 20 of Legislative Decree No 241 of 1997 must be completed by 16 December, and the instructions for the Redditi PF 2026 and 730/2026 returns allow it only for the balance and the first payment on account. The postponement to January with payment in five instalments, granted to VAT-registered individuals with revenue or fees of up to 170,000 euro for 2023 and 2024, was a temporary measure: as at the date of publication, no such measure has been introduced for 2026.

A taxpayer who has joined the two-year preventive agreement (concordato preventivo biennale) for the first time and uses the historical method must add a surcharge to the second instalment under Article 20(2)(a) of Legislative Decree No 13 of 12 February 2024. The surcharge is 10 per cent of the excess of the agreed income over the business or self-employment income declared for the previous year, as adjusted under the rules of the agreement. If the forecast method is used instead, the second instalment equals the difference between the payment on account calculated on the agreed income and the first instalment paid under the ordinary rules, as provided in point (c) of the same paragraph: the estimate is therefore made on the agreed income. On renewal neither the surcharge nor the point (c) calculation applies: paragraph 3-bis, inserted by Legislative Decree No 148 of 7 August 2026, disapplies paragraphs 2 and 3 in full from the 2026–2027 two-year period.

From 1 January 2027

The rules on payments on account will be transferred to Articles 72 to 74 of the Consolidated Act on Tax Payments and Collection (testo unico dei versamenti e della riscossione), approved by Legislative Decree No 33 of 24 March 2025, which applies from 1 January 2027. The split between the first and second instalments, by contrast, remains in Article 17 of Presidential Decree No 435 of 2001, to which the Consolidated Act continues to refer. The second payment on account for 2026 remains governed by the provisions cited in this article.

In practice

By 30 November 2026, taxpayers should:

• recalculate the expected 2026 tax at 33 per cent on the second bracket and compare it with the 2025 tax, taking into account the actual trend in the year’s income, tax deductions and amounts withheld;
• choose between the historical and the forecast method, documenting the estimate when paying less than the amount shown in the return;
• subtract the first instalment already paid, of 40 or 50 per cent, from the payment on account due;
• if they filed a 730 return, hand the written notice to the withholding agent by 12 October, preferably by 9 October;
• check available credits for set-off, any overdue tax debts above 50,000 euro and whether a compliance endorsement is required.

If in 2027 the payment on account turns out to have been insufficient, it is advisable to regularise it through voluntary correction by the deadline for filing the return for 2026, at the end of October 2027, with the penalty reduced to 3.125 per cent; after that deadline the penalty is reduced only to one seventh, about 3.57 per cent.

Frequently asked questions

My income is 60,000 euro, unchanged from 2025. How much can I save with the forecast method?

Where income is not subject to withholding tax (business income, for example) and both income and tax deductions are unchanged, the 2026 tax is 440 euro lower than the 2025 tax, because the rate on the whole second bracket, above 28,000 and up to 50,000 euro, falls from 35 to 33 per cent. Since the first instalment has already been paid, the whole difference is reflected in the second. The saving is smaller if income rises in 2026 or if tax deductions or amounts withheld change.

I am an employee and filed a 730 return with no income other than my salary. Do I need to do anything?

As a rule, no. If the 2025 tax was fully covered by the employer’s withholding, the payment on account calculated in the 730 is nil or minimal, and the 2026 withholding is already calculated at the new rate. The check is relevant for taxpayers who also have income not subject to withholding, such as rental income taxed under the ordinary rules, or income subject to withholding at a rate below their marginal rate, such as fees for occasional self-employment subject to 20 per cent withholding.

What happens if I pay less and my 2026 income then turns out to be higher?

A penalty of 25 per cent applies to the difference between the amount paid and the payment on account due, which is the lower of the amount calculated on the 2025 tax and the amount calculated on the actual 2026 tax. The penalty is reduced through voluntary correction according to when the regularisation takes place, and interest at the statutory rate is added. The 2026 balance, by contrast, is paid in the ordinary way with the return filed in 2027.

Sources

Article 1 of Law No 97 of 23 March 1977 and Article 11(18) of Decree-Law No 76 of 28 June 2013, converted into law by Law No 99 of 9 August 2013.

Article 17(3) of Presidential Decree No 435 of 7 December 2001.

Article 58 of Decree-Law No 124 of 26 October 2019, converted into law by Law No 157 of 19 December 2019; Article 12-quinquies(3) and (4) of Decree-Law No 34 of 30 April 2019; Agenzia delle entrate, Resolution No 93/E of 12 November 2019.

Article 1(3), (4) and (116) of Law No 199 of 30 December 2025; Article 11(1) and Article 16-ter(5-bis) of the Consolidated Income Tax Act, approved by Presidential Decree No 917 of 22 December 1986.

Article 1(4) of Legislative Decree No 216 of 30 December 2023, as amended by Decree-Law No 55 of 23 April 2025, converted into law by Law No 86 of 19 June 2025.

Article 4(2) and (3) of Decree-Law No 69 of 2 March 1989, converted into law by Law No 154 of 27 April 1989.

Article 13 of Legislative Decree No 471 of 18 December 1997 and Article 13 of Legislative Decree No 472 of 18 December 1997, as amended by Legislative Decree No 87 of 14 June 2024; Decree of the Minister of Economy and Finance of 10 December 2025 on the statutory interest rate.

Articles 17 and 20 of Legislative Decree No 241 of 9 July 1997; Article 37(49-quinquies) of Decree-Law No 223 of 4 July 2006; Article 1(574) of Law No 147 of 27 December 2013.

Article 20(2), (3) and (3-bis) of Legislative Decree No 13 of 12 February 2024, as amended by Legislative Decree No 148 of 7 August 2026.

Articles 72–74 and 243 of the Consolidated Act on Tax Payments and Collection, approved by Legislative Decree No 33 of 24 March 2025, applicable from 1 January 2027.

Agenzia delle entrate, instructions for the Redditi PF 2026 and 730/2026 returns; 2026 pre-filled return calendar.