# Guide to the ISTAT Index for Severance Pay: Calculation and Forecasts > Find out how to calculate the revaluation of severance pay using the ISTAT index: a practical guide for 2026 with clear formulas and up-to-date examples. Source: https://www.electe.net/post/indice-istat-per-tfr Site guide: https://www.electe.net/llms.txt The Trattamento di Fine Rapporto (TFR) is not a simple piggy bank where the money sits still. It's more like a capital that grows, year after year, to avoid losing value against inflation. Driving this growth is a precise mechanism: revaluation, a process based on the **ISTAT index for TFR** that every HR manager and CFO must master. In this guide, we’ll show you how the revaluation calculation works, how to interpret ISTAT data, and, most importantly, how to turn this legal requirement into a strategic opportunity. You’ll learn not only how to calculate severance pay accurately, but also how to use the data to make accurate budget forecasts and make better decisions for your company. ## Why is the revaluation of severance pay crucial for your company? For your company, managing salary adjustments effectively means having full control over personnel costs and planning your finances without any surprises. Even a minor miscalculation can throw your budget off balance and turn into an administrative nightmare. On the other hand, for your employees, this mechanism is a fundamental safeguard. It ensures that their accrued severance pay isn’t eroded by rising living costs, keeping its purchasing power intact over time. The engine behind it all is a very specific indicator, the **ISTAT FOI index** (the consumer price index for Families of Blue-Collar and White-Collar Workers), which tracks the trend of inflation. This isn't a choice, but a legal obligation set out in black and white by Article 2120 of the Italian Civil Code. > In short, revaluation acts as a small growth engine applied to the accrued TFR. Each year, this capital increases thanks to a formula that combines a fixed rate with a percentage linked to inflation. It's a system designed to protect the real value of that sum. Fully understanding this mechanism is the first step toward truly efficient and transparent HR management. We'll look together at the exact formula, breaking it down into fixed and variable parts, and we'll work through a numerical example to see how it applies in practice. You'll discover how the **ISTAT index for TFR** affects the final result and how a data analytics platform like [Electe](https://www.electe.net/) can turn this legal obligation into an analysis opportunity. ## The formula for revaluing severance pay: how it really works The revaluation of severance pay is not based on some incomprehensible formula, but on a two-pronged mechanism designed with a specific goal in mind: to ensure a reliable foundation for growth while, at the same time, protecting capital from inflation. Think of it as a safety net. The first component is a solid, predictable base: a **fixed rate of 1.5% per year**. This value isn't credited all at once, but is spread out month by month, with an accrual of **0.125%** every thirty days. It's the guarantee of steady growth, a foundation you can rely on. ### The two sides of the formula The second component, on the other hand, is the engine that adapts to the real economy, a dynamic protection that responds to the rising cost of living. This is where the famous **ISTAT index for TFR** comes in, which is nothing other than the FOI index (for Families of Blue-Collar and White-Collar Workers), the official thermometer of inflation in our country. The law establishes that the TFR is credited with **75% of the increase in this index**, calculated against the value it had in December of the previous year. In simple terms: if inflation rises, the TFR is adjusted so it doesn't lose purchasing power. Putting it all together, the formula that determines the final coefficient is as follows: **Revaluation Coefficient = (75% x \[ISTAT Index % Change\]) + 1.5%** This coefficient is then applied to the total severance pay that the employee had accrued as of December 31 of the previous year. > In essence, the system combines a guaranteed minimum growth with an adjustment for inflation. A balance designed to give peace of mind to the employee, whose severance pay isn't eroded by time, and predictability to the company, which can plan costs with greater certainty. ### A practical example using real data Let's make this more concrete. In January 2026, for example, ISTAT announced a monthly revaluation coefficient of **0.363025%**. This small number, which applies to all TFR amounts accrued up to December 31, 2025, where does it come from? It's the perfect sum of the two parts: the fixed monthly share of **0.125%** and the variable share, which for that specific month was **0.238025%** (that is, 75% of the change in the FOI index). If you want to dig deeper, you can always check the [official sources on TFR revaluation](https://www.ecnews.it/lavoro/rapporto-di-lavoro/gestione-del-rapporto/tfr-indice-rivalutazione-gennaio-2026/). Understanding this mechanism is the first step toward HR and financial management that leaves nothing to chance. The fixed share provides a stable calculation base, while the variable share, tied to the **ISTAT index for TFR**, ensures that the real value of the severance pay is protected. It's this balance that makes the system fair and sustainable, both for employees and for the company. ## How to Calculate Revaluation: A Practical Example The theory is clear, but it's the numbers that make the difference. To really understand how TFR revaluation works, nothing is more effective than a practical example. Let's take the case of an employee, Mario, who as of December 31, 2025, has accrued a TFR of **€25,000**. Let's see, step by step, how this amount changes over the course of 2026. The starting point is always the same: calculate the **revaluation coefficient**. To recap: this rate is the result of a fixed component, guaranteed by law, and a variable one, which ties the TFR to the trend of the real economy via the **ISTAT index**. For our example, let's assume that in 2026 the annual change in the ISTAT consumer price index (the FOI) is **2.0%**. ### Calculate the revaluation coefficient The formula is simpler than it seems. You simply add two values together: 1. **A fixed part**, which never changes: it's always **1.5%** on an annual basis. A sort of guaranteed minimum return. 2. **A variable part**, which depends on inflation. It's calculated by taking 75% of the change in the ISTAT index. In our case: 75% of 2.0% = **1.5%**. At this point, you simply add the two components together: 1.5% (fixed share) + 1.5% (variable share) = **3.0%**. This **3.0%** is the rate we'll use to revalue Mario's accumulated gross TFR. The diagram below offers a visual summary of this process. As you can see, the mechanism is straightforward: a fixed base rate is adjusted to reflect the cost of living (the ISTAT index) to arrive at the final coefficient. ### From gross amount to net amount Now that we have our coefficient, let’s apply it to Mario’s severance pay: - **Gross Revaluation:** €25,000 x 3.0% = **€750** This is the theoretical increase. However, it is not the final amount that will be added to the employee’s capital. In fact, the government applies a substitute tax to this amount, a step that often causes some confusion. > The substitute tax on TFR revaluation is **17%**. The key point to remember is that this tax applies **only to the revaluation amount** (the €750 in our example), not to the entire accrued TFR. Let's see how much tax is due: - **Substitute Tax:** €750 x 17% = **€127.50** This is the amount the company withholds on behalf of the government. The net adjustment—that is, the actual increase for the employee—is calculated by subtracting the tax from the gross increase. - **Net Revaluation:** €750 - €127.50 = **€622.50** Here we are at the finish line. To find out what Mario’s new severance pay balance will be as of December 31, 2026, all we have to do is add the net revaluation to the initial principal: - **New TFR Total:** €25,000 + €622.50 = **€25,622.50** This step-by-step simulation, summarized in the table below, shows how each element contributes to the final result. ### Example of Severance Pay Revaluation Calculation for 2026 _A step-by-step simulation to calculate the annual revaluation on a TFR accrued as of December 31, 2025._ **Step****Description****Example Value**1. Initial AmountTFR accrued as of 12/31/2025€25,0002. Calculation of Variable Portion75% of the ISTAT variation (2.0%)1.5%3. Calculation of Total CoefficientFixed portion (1.5%) + Variable portion (1.5%)3.0%4. Calculation of Gross RevaluationInitial amount x Total coefficient€7505. Calculation of Substitute TaxGross revaluation x 17%€127.506. Calculation of Net RevaluationGross revaluation - Tax€622.507. New TFR AmountInitial amount + Net revaluation€25,622.50 Having a clear understanding of these steps allows you to verify your calculations and ensure maximum transparency. Although the process is logical, it requires precision and, above all, access to up-to-date ISTAT data—a crucial aspect that we will explore how to optimize. ## ISTAT coefficient tables for 2026 and previous years To calculate the revaluation of severance pay correctly and, above all, to analyze its trends over time, official data are not merely useful—they are the only reliable guide. Revaluation coefficients, in fact, are not static figures. On the contrary, they are a direct reflection of economic fluctuations and inflation, making the management of severance pay a dynamic process. For an error-proof calculation, you should refer to the tables published periodically by ISTAT. These values are central to the mechanism and serve to ensure that severance pay retains its purchasing power. ### Monthly coefficients for 2026 When an employment relationship ends during the year, a generic annual rate cannot be applied. Instead, the rate specific to the month in which the employment ends must be used. This small but crucial detail ensures that the calculation is always in line with the inflation rate recorded up to that precise moment. Below is a projection of the coefficients we expect for the months of 2026. Each row shows the coefficient to be applied if the employment relationship ends in that month, calculated based on available ISTAT data. #### Monthly Severance Pay Revaluation Coefficients for 2026 This table summarizes the ISTAT indices and monthly coefficients used to calculate the revaluation of severance pay in 2026. **Application Month****FOI Index****% Change (vs Dec '25)****75% of the Change****Fixed Monthly Rate****Total Coefficient**January 2026121.50.25%0.1875%0.1250%0.3125%February 2026121.70.41%0.3075%0.2500%0.5575%March 2026121.90.58%0.4350%0.3750%0.8100%.................. As you can clearly see, the fixed rate accrues month after month, while the variable component depends directly on the **ISTAT index for severance pay (TFR)**. Managing this data manually, payslip by payslip, can turn into a real headache. It's no coincidence that many companies are starting to [convert PDF files into Excel reports](https://www.electe.net/post/convertire-un-file-pdf-in-excel) to centralize information before moving on to more automated systems. ### Historical trend of annual coefficients Looking at historical data is just as important as having current data. Analyzing past trends helps you understand the volatility of currency fluctuations and, as a result, prepare more accurate budget forecasts for the future. > Volatility is an intrinsic feature of TFR revaluation. In December 2025, for example, the coefficient reached **2.311148%**, while in December 2015 it was just **1.5000%**. These peaks and troughs clearly show how inflation directly impacts personnel costs. The historical trend of the coefficients is a goldmine for anyone who needs to model future scenarios. Past tables show notable volatility: for those who want to dig deeper, you can consult the [historical series of revaluation coefficients](https://www.lavorofacile.it/news/tfr-coefficiente-di-rivalutazione-gennaio-2026) for a complete picture. Understanding these fluctuations is the first, essential step toward transforming what appears to be a simple accounting requirement into a strategic planning tool. ## Automate severance pay calculations and say goodbye to errors Manually calculating TFR revaluation is one of those tasks that seems simple but hides a huge cost. It's a ritual repeated every month: looking up the latest **ISTAT index for TFR**, updating Excel sheets full of complex formulas, double- and triple-checking. The result? Wasted time and a very high risk of errors that can cost your company dearly. This traditional, fragmented, and manual approach is not just inefficient. It acts as a real brake on HR management, because it prevents you from having a clear and up-to-date view of costs. Every time ISTAT publishes a new index, the cycle starts all over again. A simple regulatory requirement turns into repetitive, low-value work. ### From Excel to Automated Efficiency The good news is that you can break out of this cycle. An AI-powered data analytics platform like ELECTE designed specifically to eliminate this type of problem at its root. Instead of forcing your team to search for and enter data, the platform connects directly to ISTAT’s official sources, automatically retrieving the coefficients and handling the entire revaluation calculation. This changes everything, for two key reasons: - **Absolute precision.** Automation eliminates the risk of human error. No more mistyped indices or incorrectly applied formulas. Calculations are always perfect and compliant with regulations. - **Time recovered.** You free up the HR team from hours of tedious, repetitive work. Those same people can finally focus on strategic activities: analyzing labor costs, forecasting budgets, and looking after employee wellbeing. For an SME, the benefits are immediate. Having real-time visibility into personnel costs becomes the norm, not the exception. And being able to base budget forecasts on consistently up-to-date and reliable data translates into a tangible competitive advantage. > Abandoning manual methods isn't just a process optimization. It's a cultural shift: it means adopting a data-driven mindset, where precision and efficiency become the pillars of financial and human resources management. ### The Tangible Benefits of Automation for SMEs But automation does much more than just perform a calculation. It lets you integrate TFR data with all other company indicators, offering an overview that a spreadsheet could never give you. For those managing people and budgets, this means immediate operational benefits. If you're looking for practical tips on how to organize data for this kind of analysis, our article on how to create an [**Excel table for data management**](https://www.electe.net/post/tabella-excel-esempio) can give you some ideas. Here's what you get in practice: - **Automatic reporting:** You can generate monthly or annual reports on TFR trends with a single click, with no more manual compiling required. - **Reliable forecasts:** You use historical ISTAT index data to build forecasting models. This way, you can estimate the impact of future inflation on TFR costs and prepare in advance. - **Cost control:** You monitor in real time the impact of revaluation on total labor cost, both per employee and per department. In short, choosing to automate the calculation of severance pay means turning a legal requirement into a strategic opportunity. You ensure full compliance with regulations while freeing up valuable resources to help your business grow. ## Turning Severance Pay Data into Strategic Decisions Once the calculation is automated, you can make the real leap forward. An AI-powered platform like Electe doesn't just execute a formula—it turns raw TFR data and the **ISTAT index for TFR** into ready-to-use insights. Because the real potential lies not in the calculation, but in the analysis that comes from it. Imagine being able to see, with just one click, how a revaluation affects labor costs for each individual department. Or perhaps comparing current costs with accurate forecasts based on inflation trends, simulating future scenarios for your budget. Instead of reacting to ISTAT data when it’s released, you can start anticipating it. ### From raw data to proactive action This shift in perspective transforms the management of severance pay from a passive, almost involuntary process into a proactive one. You are no longer forced to chase after fluctuations in inflation; instead, you learn to anticipate them and manage their effects well in advance. Here are some practical examples of how you can use this data: - **Cost forecasting:** If forecasting models point to a likely rise in inflation over the coming quarters, the platform immediately estimates the higher costs linked to TFR. This lets you adjust the budget months in advance, with no unpleasant surprises at year-end. - **Departmental analysis:** You can finally see the impact of TFR revaluation on personnel costs for each department. Valuable information for better understanding your cost structure and making targeted decisions on where to allocate resources. - **Scenario simulation:** You can create "what-if" simulations to answer concrete questions. For example: "What would happen to our accrued TFR if inflation rose by another **0.5%**?". > In this way, ELECTE turns an accounting requirement—often seen as a burden—into a powerful business intelligence tool. Proactive management of finances and human resources is finally within reach. The end goal is clear: not just to calculate, but to understand. Understanding the impact of each variable gives you the control you need to plan the future with greater confidence. If you want to learn more about how to visualize this data, our article on [how to create a chart in Excel](https://www.electe.net/post/come-creare-un-grafico-su-excel) offers useful pointers to get started. Visual analysis is the first step in turning complex numbers into clear decisions. ## Frequently Asked Questions (FAQ) When it comes to the revaluation of severance pay, the same questions always come up. That’s normal. We’ve compiled the most frequently asked questions here to provide you with clear and straightforward answers. ### Where can I find the official ISTAT index for the calculation? The ISTAT FOI Index (Households of Blue-Collar and White-Collar Workers) is published monthly in the Official Gazette and on the ISTAT website. The problem? Manually searching for this data month after month leaves room for oversights and transcription errors. This is where data analytics platforms like [Electe](https://www.electe.net) come into play. They connect directly to official sources, automating data acquisition. This way, your calculations are always based on correct, up-to-date coefficients, without you having to lift a finger. ### Does the revaluation also apply to the portion of severance pay for the current year? No, and this is a point that often causes confusion. The annual revaluation applies **solely and exclusively to the TFR capital the employee has accrued up to December 31 of the previous year**. The portion of TFR accruing during the current year, on the other hand, is not affected by that year's revaluation. It will be added to the existing accrued amount, becoming the new calculation base for the following year. ### What happens if inflation turns negative? Let's consider a deflation scenario, where the change in the FOI index is negative. Does the employee's TFR decrease? Absolutely not. The law provides a safety net: in this case, the variable component of the revaluation is simply set to zero. The capital is not only protected but still grows thanks to the **guaranteed fixed rate of 1.5% per year**. It's a mechanism that ensures minimum, guaranteed growth. ## Conclusions Managing TFR revaluation doesn't have to be a complex, manual task. Understanding the formula, knowing where to find the **ISTAT index for TFR**, and above all, relying on automation can turn a legal obligation into a real competitive advantage. Switching from manual spreadsheets to an AI-powered platform doesn’t just save time and eliminate errors. It also provides strategic insights into labor costs, enables more accurate budget forecasts, and frees up your HR team to focus on higher-value tasks. Moving from reactive to proactive management is the key step toward making smarter decisions and driving your company’s growth. Ready to turn your HR data into strategic decisions? [Discover how Electe works](https://www.electe.net) and take your management to the next level.