Italy's Hyper-Depreciation 2026: Guide for Software and 4.0 Assets

Updated October 2026. This article is not tax advice: before deciding on an investment, check the figures with your accountant.

The hyper-depreciation 2026 (iperammortamento) is an Italian tax incentive introduced by Italy's 2026 budget law: it increases the cost of new capital assets for tax purposes, so if you invest in 4.0 machinery, software included, you deduct more from taxable income than you actually spent, up to an extra 180% on the first investment bracket. It applies to investments completed from 1 January 2026 to 30 September 2028 and, as of late October 2026, it is fully operational: all three required filings can be submitted on the GSE platform. It is relevant to companies that are tax resident in Italy or have a permanent establishment there.

In the article on digitalisation grants for 2026 we gave a summary of the measure. Here we go into the detail that matters if you're assessing a software project: which programs qualify, what interconnection means, which documents you need and where people most often go wrong.

What Italy's hyper-depreciation 2026 is and which rules govern it

The legal basis is Law no. 199 of 30 December 2025, article 1, paragraphs 427 to 436. The acquisition cost of qualifying assets is increased only for the purpose of calculating depreciation allowances and lease payments. MIMIT, the Italian Ministry of Enterprises and Made in Italy, presents it as the measure replacing the Transizione 4.0 and 5.0 tax credits, and clarifies that it is not a credit to be offset through the F24 payment form: it reduces taxable income for income tax purposes.

The operating rules are in the interministerial decree of MIMIT and the Ministry of Economy and Finance (MEF) of 7 May 2026. The decree was registered by the Court of Auditors on 20 May 2026 and published on the MIMIT website on 11 June. Only a notice of its adoption appeared in the Official Gazette, in Gazzetta Ufficiale no. 139 of 18 June 2026, which refers to the ministry's website for the full text. If you search for it in the Gazette and can't find it, that's why.

Three MIMIT directorial decrees then opened the stages of the procedure. Advance notifications started on 12 June 2026, confirmation notices at the end of July and completion notices on 15 October 2026.

There's also an update to be aware of. Italy's new consolidated income tax code (Legislative Decree no. 117 of 19 June 2026) restates the rules in article 364, with the lists of assets in annexes E and F. On Normattiva, Annex V of the budget law is shown as repealed from 1 January 2027. In the paragraphs we compared the rules are the same, but for investments completed from 2027 your accountant will need to cite the new references.

Who is entitled to the hyper-depreciation

It is available to companies resident in Italy and to permanent establishments of foreign entities, regardless of legal form, size, sector and the regime used to determine income. The investments must be allocated to production facilities located in Italy. Since the law refers to "persons earning business income", a self-employed professional who does not earn business income is excluded.

Companies in voluntary liquidation, bankruptcy, composition with creditors without business continuity or other insolvency proceedings are excluded, as are those subject to disqualification sanctions under Italian Legislative Decree 231/2001. For all others, the benefit remains conditional on complying with workplace safety rules and on regular payment of social security contributions for employees. If you have contribution arrears, settle them before you start.

You also need income to deduct from. A loss-making company gets no immediate advantage, and how much it can recover later depends on the loss carry-forward rules: it's a calculation to do with your accountant before placing the order.

Hyper-depreciation rates: the three brackets

The uplift is calculated by bracket, on investments completed in each year:

For an SME, almost always only the first row matters. The additional deductions are added to the ordinary depreciation of the same asset.

The uplift can be used from the tax period in which you send the completion notice to the GSE, provided the asset came into operation within the same period and the GSE has communicated a positive outcome of its checks. If the software goes live in December 2026 but the completion notice goes out in February 2027, the benefit slips by a year. The law adds that the tax advance for the period in progress at 31 December 2026 must be calculated without taking the incentive into account.

Hyper-depreciation for software: what Annex V says about intangible assets

Annexes A and B of the Industria 4.0 plan are no longer the reference: for the hyper-depreciation 2026 what counts are Annex IV (tangible assets) and Annex V (intangible assets) of Law 199/2025, which according to MIMIT replace and update them.

Annex V covers "software, systems, platforms, applications, algorithms and digital models supporting the digital transformation of companies". There is no generic entry for business management software: the list describes specific functions. For the projects we work on most often, these are the entries to look at:

• management and coordination of production integrated with factory logistics and maintenance, with explicit examples such as MES, SCADA and CMMS systems (letter d);
• monitoring of the operating conditions of machines and production systems, interfaced with factory information systems or the cloud (letter e);
• quality management at production system level (letter l);
• supply chain management systems, including drop-shipping in e-commerce (letter z);
• management and coordination of logistics with a high level of service integration, such as handling, shipping and supply chain (letter bb);
• artificial intelligence, including generative AI, autonomous agents, predictive maintenance and process mining (letter dd);
• integration between IT and OT systems and platforms for data exchange between supply chain partners (letter ff);
• low-code and no-code platforms for industrial applications, operational dashboards and process automation (letter gg).

The list also includes cybersecurity, extended reality, digital twins and energy management.

An invoicing system, a sales CRM or an accounting program, taken on their own, don't match any of these entries. Under the Transizione 5.0 credit, business management software was eligible if purchased together with energy monitoring software; Annex V has no such clause. A warehouse management system that coordinates handling and shipping may come close to letter bb, and a module that plans production and collects data from machines to letter d. The decision lies with the expert appraiser, who has to recognise the function described by the law.

Is custom software eligible?

Neither the law nor the implementing decree distinguishes between off-the-shelf and custom software: they require a new intangible capital asset, listed in Annex V, interconnected and with an acquisition cost to be depreciated. However, the official sources we consulted contain no specific clarification on software commissioned from a third party. The cautious answer is this: it can qualify if your accountant records it under intangible fixed assets and if the appraiser recognises its functions and interconnection.

Two practical consequences. The contract must make clear that the code and usage rights pass to the company, so the asset can be recorded on the balance sheet. A SaaS subscription is normally an operating expense, neither a depreciated asset nor a lease payment, so it is unlikely to qualify for the uplift. Here too, get confirmation from your adviser.

Interconnection: the requirement that decides

Paragraph 429 requires the assets to be "interconnected with the company's production management system or with the supply network". For software, this means showing that it exchanges data automatically with machines, with the ERP or with suppliers. The interconnection date must already be stated in the advance notification, and completion of the investment coincides with interconnection taking place.

In our projects, interconnection is a matter of integrations and APIs more than of user interface. In Buzzi Connect, for example, the software talks to the welding machines via Modbus TCP/IP and makes production data available to MES and ERP. That's the kind of flow an appraiser can verify, with logs and technical documentation to hand.

The "made in the EU" requirement has been removed

The original version of paragraph 427 only allowed assets produced in a European Union or European Economic Area member state. Article 7 of Decree-Law no. 38 of 27 March 2026, converted by Law no. 88 of 22 May 2026, removed that restriction with effect for investments made from 1 January 2026.

GSE filings, expert appraisal and accounting certification

Everything goes through the "Nuovo Piano Transizione 5.0" platform in the Customer Area of the GSE, Italy's state-owned energy services agency, with access via SPID or CIE (Italian digital identity). There are three stages.

1. Advance notification. For each production facility you state the assets, the amounts, the expected completion date, the depreciation rate and the expected interconnection date. The GSE replies within ten days with a positive outcome or a request for additional information, which must be sent within a further ten days.
2. Confirmation notice. Within 60 days of the positive outcome you declare that you have paid at least 20% of the cost of each asset, with payment date and amount and invoice references. You can't add new assets and the amounts can only go down. For leased assets, the contract with the order signed by the leasing company is enough.
3. Completion notice. Once interconnection is in place, and in any case by 15 November 2028, you report the completion of the investment and declare that you hold the expert appraisal and the accounting certification.

The sworn technical appraisal is issued by an engineer or an industrial expert registered with the relevant Italian professional body, or by an accredited certification body in the form of a certificate. It must show that the asset has the characteristics of Annex IV or V and that it is interconnected. The accounting certification is signed by a statutory auditor or an audit firm and confirms that the expenses were incurred and match the accounts.

Two periodic notices remain every year: by 20 January on the investments and the planned use of the benefit, and by 30 June with the depreciation schedule. If the requirements are not met, if the documentation is not kept or if the asset is sold without being replaced by a similar one, the company loses the benefit and the GSE reports the recovery to the Agenzia delle Entrate, the Italian Revenue Agency, with interest and penalties.

Hyper-depreciation calculation example (illustrative)

Take an Italian limited company (srl) that produces metal components. In 2026 it commissions software to plan production, collect data from machines and manage maintenance, connected to its existing ERP. Cost: €120,000. Assume the appraiser places it under letter d of Annex V, that interconnection is documented and that the completion notice is sent in the same year the software comes into operation.

• Uplift: €120,000 × 180% = €216,000 of additional deductions.
• Maximum IRES (Italian corporate income tax) saving, at the standard 24% rate: €216,000 × 24% = €51,840.
• The saving doesn't arrive all in one year: it is spread over the software's tax depreciation schedule.

The example is simplified: it doesn't consider grants on the same costs, past losses, the cost of appraisal and certification, or the case of a partnership subject to IRPEF (personal income tax). The real calculation is done by your accountant on your financial statements.

Common mistakes with the hyper-depreciation

• Treating it as a grant or a tax credit. It's a deduction: without taxable income it brings no immediate advantage.
• Budgeting for a CRM or a purely administrative system and taking it for granted that it's "4.0 software". Before signing, compare its functions with the letters of Annex V.
• Underestimating the amounts in the advance notification. In the later stages amounts can only go down and no assets can be added.
• Letting the 60-day deadline for the confirmation notice expire. The decree provides that failing to file on time ends the procedure.
• Considering the project finished at go-live. For the GSE, completion coincides with interconnection, and the benefit starts from the period in which you send the completion notice.
• Calling in the appraiser once the work is done, with no documentation on data flows and integrations.

Hyper-depreciation, Transizione 5.0 and Nuova Sabatini

The funds for Transizione 5.0, the tax credit financed by Italy's recovery plan (PNRR), and for Transizione 4.0 have run out: the GSE still accepts bookings, which will only be met if new funds become available. The hyper-depreciation is a different measure: it doesn't require a reduction in energy consumption and covers investments completed from 2026. However, the law excludes from the uplift investments that benefit from the 2025 4.0 credit on tangible assets (article 1, paragraph 446, of Law 207/2024), which could extend to 30 June 2026 for orders placed by the end of 2025.

The Nuova Sabatini scheme finances investments by Italian SMEs, software and digital technologies included, with a MIMIT capital grant. Paragraph 431 allows the hyper-depreciation to be combined with other incentives on the same costs, provided the support doesn't cover the same portions of cost and doesn't exceed the cost incurred, and provides that the base for calculating the uplift is taken net of grants received for those costs. In practice the two measures can be combined, but the uplift is calculated on a lower amount. The combination must also be checked against the Sabatini rules: involve your bank and your accountant together.

How to prepare a software project for the hyper-depreciation

The method we suggest to clients starts from the law and arrives at the quote, not the other way round.

1. Write down which process you want to digitalise and link it to a specific letter of Annex V. If you can't find the letter, the project may still make sense, but without hyper-depreciation.
2. Have the appraiser read the description before the order, not once the project is finished.
3. Ask for a quote broken down by module, with separate items for development, third-party licences, hardware and training: the auditor works from the invoices.
4. Plan the dates: advance notification, 20% down payment within the 60 days for confirmation, interconnection and completion in the same tax period in which the software comes into operation.
5. Insist on technical documentation for the integrations (protocols, APIs, data flows, logs): the appraiser needs it and it stays useful to you afterwards.

When we develop custom business software we work in two-week sprints, with a staging environment where the client tests every release, and the code remains the client's property. If the project aims at the hyper-depreciation, we add a document that maps each module to the relevant entry in the annex and describes the interconnection. If instead you need a CRM for your sales network with no link to production or the supply chain, we'll tell you straight away: the hyper-depreciation probably doesn't apply.

Let's talk

If you're considering a lightweight MES, maintenance software or an integration between machines and ERP and want to understand whether it can qualify for Italy's hyper-depreciation 2026, book a call with us. We start from your process, tell you which functions may match Annex V and prepare a technical description that your appraiser and accountant can assess. The tax decision remains theirs.

Sources consulted on 29 October 2026 (in Italian)

• Normattiva, Law no. 199 of 30 December 2025, article 1, paragraphs 427-436 and Annex V
• Normattiva, Decree-Law no. 38 of 27 March 2026, article 7
• Normattiva, Legislative Decree no. 117 of 19 June 2026, article 364
• Gazzetta Ufficiale, MIMIT notice on the decree of 7 May 2026, Official Gazette no. 139 of 18 June 2026
• Department for the Government Programme, Implementing decree on hyper-depreciation signed
• MIMIT, Nuovo Piano Transizione 5.0 - Iperammortamento
• GSE, Nuovo Piano Transizione 5.0: overview, how to apply and status of Transizione 5.0 funds
• incentivi.gov.it, Beni strumentali - Nuova Sabatini