Social security contribution relief to promote employment in disadvantaged areas
- February 25, 2025
- Reading time: 12 min
News . 8/2025
We would like to draw your attention to two measures that provide tax breaks for employment in disadvantaged areas:
1) SUD SME Social Security Contribution Relief, as provided for in the 2025 Budget Law, Article 1, paragraphs 406 et seq., and as outlined in News No. 32/2025; (page 1 et seq.)
2) ZES Bonus, for the permanent hiring of individuals over 35 who have been unemployed for at least 24 months, pursuant to Decree-Law No. 60/2024, Article 24 (the so-called “Cohesion Decree”), has been given the green light following the publication on February 21, 2025, of the Implementing Decree dated January 7, 2025. (page 8 and following)
SUD SME Social Security Contribution Relief
Article 1, paragraph 406 et seq. of the 2025 Budget Law provides for private employers—excluding those in the agricultural sector and domestic employment contracts— an exemption from the payment of social security contributions, excluding premiums and contributions due to the National Institute for Insurance against Accidents at Work, limited to micro-enterprises and small and medium-sized enterprises employing permanent workers in the regions of Abruzzo, Molise, Campania, Basilicata, Sicily, Apulia, Calabria, and Sardinia, in order to maintain employment growth levels in Southern Italy and contribute to reducing regional disparities.
The terms “microenterprise” and “small and medium-sized enterprise” refer to private employers with no more than 250 employees, whose annual turnover does not exceed 50 million euros and/or whose annual balance sheet total does not exceed 43 million euros (pursuant to Article 1 of Annex I to Commission Regulation (EU) 2014/651 of June 17, 2014).
In this regard, please note that employers who operate a business with more than 250 employees, or who exceed the aforementioned thresholds for annual revenue and/or balance sheet total, are eligible for a different contribution exemption referred to in Article 1, paragraphs 413 et seq. of the 2025 Budget Law, subject, however, to prior authorization from the European Commission.
By express provision of law, employers who enter into apprenticeship contracts are excluded from the scope of application of the measure in question.
The exemption referred to in paragraph 413 is granted provided that the employer demonstrates, as of December 31 of each year, an increase in the number of permanent employment contracts compared to the previous year.
In a circular dated January 30, 2025, INPS provided guidelines and operational instructions for managing social security obligations related to the contribution exemption measure.
This benefit applies only to permanent employment relationships already in place as of December 31, 2024, provided that the workplace is located in the regions of Abruzzo, Molise, Campania, Basilicata, Sicily, Apulia, Calabria, and Sardinia.
In cases where an employer, who holds a company registration number with an address matching the registered office located in regions not covered by the scope of the regulation, has one or more operational units located in the aforementioned regions of Southern Italy, the competent local INPS office must, following a specific request from the employer in question and after conducting the necessary checks, enter the authorization code “0L” in the contribution details of the company registration number, which stands for “Employer centralizing contributions with operational units in the Southern regions,” and which will be valid from January 1, 2025, through December 31, 2029.
The exemption in question is recognized:
- For the year 2025, an amount equal to 25% of total social security contributions, up to a maximum of €145 per month for twelve months, for each permanent employee hired as of December 31, 2024;
- For the year 2026, an amount equal to 20% of total social security contributions, up to a maximum of €125 per month for twelve months, for each permanent employee hired as of December 31, 2025;
- For the year 2027, an amount equal to 20% of total social security contributions, up to a maximum of €125 per month for twelve months, for each permanent employee hired as of December 31, 2026;
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