One invoice to your own company can cost €8,311

A consultant in Milan bills €50,000 a year under Italy’s flat tax and owns the small company she works alongside. In November she invoices that company €900 for a piece of advisory work, and the company puts the cost through its books. From the following January the flat tax is closed to her, and on the same €50,000 of billing that is worth €8,311 of net income.211

The size of the invoice does not come into it. The provision states no minimum, and the Agenzia delle Entrate reads it as met ogniqualvolta — whenever — such an invoice is issued and the company deducts it.7

Three things have to be true at once

Letter d) of comma 57 bars two different people. The first half catches anyone holding a share in a partnership, a professional association or a family business. The second half, the one that reaches company owners, bars those who “controllano direttamente o indirettamente società a responsabilità limitata… le quali esercitano attività economiche direttamente o indirettamente riconducibili a quelle svolte” by the taxpayer.2

Two conditions, and the circolare that reads them says both are needed: “In assenza di una delle predette condizioni, la causa ostativa non opera e il contribuente può applicare o permanere nel regime forfetario”. Control alone does not cost anyone the flat tax. Neither does having a company in the same line of work. It takes both, plus the invoice that connects them.7

Control is the one in article 2359 of the civil code, first and second paragraphs, which reaches further than a majority: the circolare’s own worked example has the exclusion biting on a 50% holding, because half the votes are enough for dominant influence in an ordinary meeting. The second paragraph counts votes held through interposed persons, and the Agenzia puts the family in that category — spouse, relatives to the third degree, in-laws to the second. So a 50% stake held by a spouse does the same work as a stake held directly.7

The rule with no number in it

Ten things end the regime, counting each limb of commi 54 and 57 separately and adding the early exit in comma 71. Five carry a limit written into the statute: €85,000 of revenue, €100,000 for the exit that bites the same year, €20,000 of spending on staff, €35,000 of employment income the year before, and the 75% of income a non-resident in the EU or the EEA must earn in Italy to stay eligible. Two more are governed by a reading the Agenzia supplied rather than the legislature: one of them a percentage, the other the confirmation that no amount is needed at all. Three carry no limit anywhere.1569

The contrast worth holding on to is between the two neighbouring limbs about who you bill. Letter d-bis) bars a person whose work goes mainly to a current or recent employer, and the circolare puts a figure on prevalentemente: receipts from that employer have to come to more than half the year’s total. Letter d), one line above it, needs a single deducted invoice. Both end the same regime, from the same January.47 What the ex-employer bar then costs, and why it keeps the regime shut for three tax years rather than two, is the subject of a separate piece.

What counts as the same business

The statute asks whether the company’s activities are riconducibili — traceable back — to the taxpayer’s, and leaves it there. The circolare turns that into something checkable: look at what each of them actually does, put both in the classification of economic activities, and ask whether they land in the same section. If they do, and the individual supplies the company something it deducts, the two activities count as one business. If they land in different sections, they do not, whatever the invoices say.7

The section is the coarsest cut the classification has. ATECO 2025 sorts 1,290 six-digit activities — its most detailed level, and the one a business file carries — into 22 lettered sections. The median section holds 31 of them; manufacturing holds 403.810

For the consultant above, the relevant box is section N, professional, scientific and technical activities, and it holds 74 codes. Inside it sit lawyers and accountants, head offices and management consultancies, architects and engineers, scientific research, advertising and market research, and veterinary practice. Her company does not have to do her job for the exclusion to reach her. It has to be one of those.810

Sections are not equal, and the number that matters is the one for your own. Somebody writing software sits in section K with 17 codes, alongside telecoms and data centres; a letting business sits in section M with 8. The wide sections are the ones where a company doing something quite unlike your work can still share your box.10

One wrinkle sits under all of this. The circolare was written in 2019 and its worked example names its sections by the letters of the classification then in use: someone in section M, professional activities, supplying a company in section J, information and communication, is outside the rule. Business files have carried ATECO 2025 codes since April 2025, and under that classification M is real estate and the professional activities are section N. The example’s answer survives, because the two activities still fall in different sections; the letters do not. The same displacement runs through the table that sets flat-rate profitability shares, which still names ATECO 2007 codes.8

When it bites, and what the year costs

Not in the year of the invoice. Comma 71 says the regime “cessa di avere applicazione a partire dall’anno successivo” to the one in which a comma 57 case arises, and reserves the same-year exit for receipts above €100,000. So the invoice sent in November is billed without VAT, taxed at the flat rate, and settled as normal; the cost lands on the following year’s income.3

For the two halves of letter d) that timing works differently. A share in a partnership can be sold before the year ends and the regime applies from January, because the test looks at the year before. The company limb looks at the year of application itself — only then can anyone see whether an invoice went out and was deducted — which is why the answer arrives after the invoices have gone.7

The year on ordinary rules is what costs the €8,311. That figure is a practice billing €50,000 on the 78% profitability share, paying the 15% substitute rate inside the regime, with nothing deductible going out. Real costs close the gap quickly, because the ordinary regime taxes profit and the flat rate taxes a fixed share of revenue whether it was earned or not.11

At real costs of 30% of revenue the year is worth €427, which is another way of saying that the people with most to lose from the invoice are the ones with the fewest expenses — the consultants and the advisers, who are also the ones most likely to own the company they advise.11

What this does not settle

Whether a company incorporated outside Italy is caught. The circolare notes that participations in joint-stock companies and in companies resident abroad “continuano a essere espressamente escluse dalla formulazione letterale” of letter d). It does not go on to say how a foreign company that corresponds to an Italian s.r.l. should be treated, and neither does the provision. A founder holding a company at home is reading a document that does not address them.72

The section counts here bound the net; they do not measure who is caught. The Agenzia is explicit that the comparison runs on the activities actually carried on “indipendentemente dai codici ATECO… dichiarati”, so a business whose declared code flatters it is judged on what it really does.7

The reading of letter d) here is the 2019 circolare and the provision as it stands today, which are word for word the same on the point that matters. Rulings issued since then were not part of this, and a specific arrangement can turn on facts no document supplies. The euro figures assume Gestione separata contributions and one representative pair of regional and municipal surcharges, so an address elsewhere in Italy moves the ordinary-rules side by some hundreds of euro.2