Italian TFR severance calculator
How much TFR has an employee accrued, and how much does the company set aside each month? Enter pay, years of service and inflation for an instant estimate.
How TFR is calculated
TFR (trattamento di fine rapporto) is the severance pay every Italian employee accrues, governed by art. 2120 of the Civil Code.
- Yearly accrual = annual pay ÷ 13.5, minus 0.50% of pay that the employer pays to INPS.
- Revaluation: every 31 December the fund accrued up to the previous year grows by a fixed 1.5% plus 75% of the rise in the ISTAT price index (FOI).
- Substitute tax: 17% is paid on the revaluation.
Example: with €30,000 a year the yearly accrual is about €2,072, or about €173 a month to set aside.
What the estimate leaves out
- Separate taxation on payout, which depends on average income in recent years.
- Advances already taken by the employee.
- TFR paid into a pension fund, which does not stay in the company.
- Pay items the collective agreement excludes.
For the exact figure you need the payslip or an accountant.
Severance is a cash outflow
In Italian companies with fewer than 50 employees the TFR stays in the business and is paid in one go when an employee leaves. CassaChiara reads Italian e-invoices and shows a 90-day cash forecast, so you can see in advance whether there is room for a large payment.
Try it free with your invoices See pricingFrequently asked questions
How is TFR calculated?
Divide annual pay by 13.5, subtract the 0.50% paid to INPS, and each year add a revaluation of 1.5% plus 75% of ISTAT inflation.
Is TFR based on gross or net pay?
On gross annual pay, meaning the regular items set by the contract.
When does the company pay TFR?
When employment ends, usually with the last payslip or within the terms of the collective agreement.
Is the data I enter sent anywhere?
No: the calculation runs in your browser.