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Tax scheme for property managers and hosts

Regime forfettario for short-term rentals: when does it really win?

The regime forfettario (Italian flat-rate tax scheme) is one of the most common tax setups for Italian property managers starting out: 15% rate (5% during the startup years), an €85,000 annual ceiling, and a profitability coefficient that depends on the activity: 86% for a property manager working for third-party owners (ATECO 68.3x), 40% for direct hospitality activity (ATECO 55.20.4x). This guide shows when it beats the simplified scheme, runs the numbers with concrete examples, and explains what changes for a property manager versus a private host.

See the examples

In sintesi

Rate: 15% (or 5% for new activities during the first 5 years) on taxable income.

Profitability coefficient: depends on the ATECO code — 86% for PMs managing third-party units (68.3x), 40% for hospitality/holiday homes (55.20.4x). Taxable income equals that percentage of revenue.

Ceiling: €85,000 in annual revenue. Above this, you exit the regime forfettario.

VAT: not applied (and not deductible on purchases either).

When it wins: when real costs sit below the flat allowance of your coefficient (60% of revenue with the 40% coefficient, just 14% with the PM's 86%). Above that, evaluate the simplified scheme (which deducts real costs).

Even with a single property? Yes — above about €15,000 in annual turnover, the startup regime forfettario beats the 21% cedolare secca (Italian flat-rate rental tax). See full comparison →

How do you calculate the regime forfettario on short-term rentals?

Example 1: first-year PM on the startup regime

A newly registered property manager (PM) with €60,000 in annual revenue (e.g. 15 units on revenue share):

Total revenue €60,000
PM profitability coefficient (86%, ATECO 68.3x) ×86%
Taxable income €51,600
Startup rate ×5%
Substitute tax due €2,580

Effective tax rate: 4.3% of total revenue (plus INPS contributions). For a PM managing third-party units the coefficient is the 86% of real-estate activities (ATECO 68.3x), not the 40% of hospitality: the flat allowance only recognizes 14% of costs. Still very competitive in the first 5 years thanks to the 5% rate. Pre-INPS-deduction figure: contributions paid are deducted from taxable income before applying the tax, so the actual amount due is lower.

Example 2: established PM on the standard rate

A property manager in year six with €70,000 in revenue:

Total revenue €70,000
Taxable income (86%) €60,200
Standard rate ×15%
Substitute tax €9,030

Effective tax rate: 12.9% of revenue. With the 86% coefficient the forfettario's edge is the low rate and the simplicity, not cost recognition: if your real costs exceed ~14% of revenue, compare it with the simplified scheme. Here too the figure is before deducting INPS contributions from taxable income.

Example 3: regime forfettario vs. simplified scheme

A PM with €70,000 in revenue and different real-cost structures:

Cost scenario Regime forfettario (86% × 15%) Simplified (~30%)* Lower tax*
Costs at 30% of revenue (€21,000) €9,030 ~€14,700 Regime forfettario
Costs at 50% of revenue (€35,000) €9,030 ~€10,500 Nearly even — INPS contributions decide
Costs at 70% of revenue (€49,000) €9,030 ~€6,300 Simplified
Costs at 80% of revenue (€56,000) €9,030 ~€4,200 Simplified

* Income-tax-only comparison (substitute tax vs IRPEF), INPS contributions excluded: the two regimes compute them on different bases (flat-rate income vs actual income), which can flip borderline scenarios such as the 50%-cost row. Simplified estimate (average IRPEF ~30% across the 23-43% brackets; sole proprietors have not paid IRAP since 2022). Forfettario column: PM managing third-party units, 86% coefficient. Exact values depend on your total income and applicable deductions/credits. Always verify with an accountant (commercialista).

Which INPS contributions does forfettario add that the cedolare secca doesn't have?

Opening a partita IVA (Italian VAT number, P.IVA) on the regime forfettario also means registering with the correct social-security scheme. For short-term rentals run as a business activity (ATECO 55.20.4x for hospitality activity, 68.3x for PMs managing third-party units), this is typically the INPS Merchants scheme (Gestione Commercianti, IVS). Contributions follow two tiers: up to the minimum contribution threshold you pay a flat annual minimum; above the threshold, contributions become a percentage of the excess income. The exact minimum and rate change every year — check the INPS website at the time of registration.

Those who meet the regime forfettario requirements can request the 35% reduction on contributions. The request is not automatic: it must be filed with INPS at registration (using the dedicated form) or by 28 February of the year you want the reduction to apply.

Why this matters when comparing with cedolare secca: the cedolare secca does not include social-security contributions. When you compare net profit between cedolare and the regime forfettario, INPS is a cost line that only exists on the P.IVA side. That's what raises the "break-even threshold" above which the regime forfettario starts to win. The exact threshold depends on which ATECO code is used (because the profitability coefficient changes) and on the year — it has to be computed case by case with an accountant (commercialista).

What are the pros and cons of the regime forfettario for property managers?

Pros

  • Low rate: 15% (or 5% startup) versus IRPEF brackets of 23-43% on the simplified scheme
  • Simple math: no need to keep full accounting books
  • No VAT on invoices: you issue invoices to clients without VAT
  • Lighter compliance: fewer tax deadlines and filings than the simplified/ordinary schemes

Cons

  • Real costs not deductible: if you have heavy costs (staff, foreign software, marketing), the fixed coefficient can be less favorable than the simplified scheme — especially the PM's 86%, which only recognizes a flat 14% of costs
  • VAT on purchases not deductible: everything you buy (PMS, software, supplies, etc.) carries VAT that you absorb as a cost
  • €85,000 ceiling: fast-growing businesses hit it within 1-2 years and have to switch schemes
  • Access restrictions: some requirements exclude you from the regime forfettario (e.g. equity stakes in companies, certain employment income)

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Disclaimer: The information on this page is for informational purposes and based on Italian tax rules at the time of writing. Rates, thresholds, and requirements can change. For specific tax decisions, always consult a qualified accountant (commercialista). Dott.House provides calculation tools but does not replace tax advice.

Frequently asked questions about the regime forfettario

What is the regime forfettario for short-term rentals?
The regime forfettario is a simplified Italian tax scheme for individuals holding a partita IVA (P.IVA), with a single 15% rate (5% for new businesses during the first 5 years). The profitability coefficient depends on the activity: 86% for a PM managing third-party units (ATECO 68.3x), 40% for direct hospitality activity (ATECO 55.20.4x) — taxable income equals that percentage of revenue. The annual revenue ceiling is €85,000. It is designed as a simpler alternative to the ordinary scheme, with no requirement to keep full accounting books and no VAT.
Who can access the regime forfettario for short-term rentals?
Individuals with a partita IVA who run short-term rental activities as professional property managers or hosts can access it. You must meet certain requirements: annual revenue not exceeding €85,000, no employment income above a specified threshold (check the current limit), and no equity stakes in companies. Rules change, so an accountant (commercialista) is the source of truth for your specific case.
How is taxable income calculated under the regime forfettario for short-term rentals?
Taxable income = total revenue × profitability coefficient. For a PM managing third-party units (ATECO 68.3x) the coefficient is 86%: €60,000 × 86% = €51,600 taxable → €7,740 tax at 15% (or €2,580 at the 5% startup rate). For direct hospitality activity (ATECO 55.20.4x) it is 40%: €60,000 × 40% = €24,000 → €3,600 (or €1,200). You CANNOT deduct real costs (cleaning, software, etc.) because the coefficient already accounts for them on a flat-rate basis.
Regime forfettario vs. simplified scheme: which one wins for short-term rentals?
It depends on real costs and on your coefficient. With the 40% hospitality coefficient, the forfettario wins when actual costs are below 60% of revenue. With the PM's 86%, only a flat 14% of costs is recognized: the comparison hinges on the low rate (5%/15% vs IRPEF 23-43%) rather than cost abatement, and with high real costs (staff, software, marketing) the simplified scheme can win. The choice requires a 12-24 month projection, ideally done with an accountant (commercialista).
Does the regime forfettario apply VAT?
No. One feature of the regime forfettario is the VAT exemption: you don't apply VAT on invoices to clients, but as a result you can't deduct VAT on purchases either. For short-term rentals this means VAT on OTA (online travel agency) commissions, on PMS (property management system) software, on supplies, etc. stays on you as a cost. This is one of the factors that weighs into the choice between regime forfettario and simplified scheme.
How much does the startup regime within the regime forfettario save?
For the first 5 years of activity, if you meet certain requirements (e.g. you haven't run a similar activity in the previous 3 years, your services aren't primarily for a former employer), the rate drops from 15% to 5%. On €24,000 in taxable income, tax falls from €3,600 to €1,200 per year — a meaningful difference that makes the startup regime forfettario very attractive in the first years of a property-management business.
What happens if I exceed €85,000 in revenue?
Between €85,000 and €100,000 in revenue you exit the regime forfettario from the following year. Above €100,000 the exit is immediate, within the same year, with VAT due on subsequent transactions. Either way you move to the simplified scheme (with VAT applied, real costs deductible, VAT on purchases deductible) or the ordinary scheme. A growing PM must monitor the threshold: for a PM with 30+ units on revenue share, €85,000 is reached quickly.
How much do INPS contributions weigh under the regime forfettario for short-term rentals run as a business?
For short-term rentals run as a business activity (ATECO 55.20.4x for hospitality activity, 68.3x for PMs managing third-party units), you register with the INPS Merchants scheme (Gestione Commercianti, IVS). Below the minimum contribution threshold you pay a flat annual minimum (check the current amount on the INPS website before planning). Above the threshold, contributions become a percentage of the excess income. Those meeting the regime forfettario requirements can request a 35% reduction on contributions: the request is not automatic and must be filed with INPS. The cedolare secca, by contrast, includes no social-security contributions. All amounts and requirements must be verified with an accountant (commercialista) for your specific case.
Is a forfettario VAT number worth it for short-term rentals above €15,000?
Above roughly €15,000 of annual turnover, many mid-volume scenarios show the forfettario startup rate (5% for the first 5 years) beating 21% cedolare on tax net — with a single unit the €20,000 worked example on the forfettario vs cedolare comparison page (40% host coefficient) can land near ~€960/year of substitute tax. INPS (Artisans/Traders scheme, with a possible 35% reduction if requested) is the line rushed comparisons forget and can reverse the result. Use the numbers on this page and the forfettario vs cedolare guide, then confirm with an accountant for your case.

Keep reading

2026 tax comparison

Forfettario vs. cedolare: above €15,000 the P.IVA wins

For owners

Cedolare secca 2026

Compliance

CIN code: what it is and how to get it

Technical guide

Short-term rental margin calculation

Pricing

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