Glossary

IRES (Italian corporate income tax)

IRES (Imposta sul Reddito delle Societa) is Italy's corporate income tax, charged on the taxable profit of companies such as SpA and Srl, cooperatives and other resident entities. Non-resident companies pay IRES only on income arising in Italy. It is the corporate counterpart to IRPEF, which taxes individuals.

For 2025 and 2026 the standard IRES rate is a flat 24% on net taxable profit, calculated by adjusting the statutory accounting result for non-deductible costs, tax depreciation and other fiscal variations. A reduced rate can apply where a company reinvests profits and increases employment under specific incentive rules.

Take a company with EUR 500,000 of taxable profit: IRES is 24% x EUR 500,000 = EUR 120,000. Most trading companies also owe IRAP on their net production value, so the combined corporate burden is higher than the 24% headline suggests.

At 24%, Italy sits close to the UK main corporation tax rate of 25% and below the German combined corporate rate of roughly 30%, while the US federal rate is 21% before state taxes. See how jurisdictions stack up in our tax comparison by country.

Source: taxsummaries.pwc.com