Italy
Company Formation
Starting at €5000
What's included for 5000€ :
What’s Included:
- Company formation
- Governmental fees for first year
- Italian tax number obtaining
- Scanned corporate documents
- Registered Address
Company formation
Company formation
Italy, a land renowned for its rich cultural heritage and breathtaking landscapes, has emerged as a compelling destination for entrepreneurs and businesses seeking to establish a strong presence in Europe. Its dynamic business environment, strategic location, and varied economy render it a hub for company establishment. Whether it’s the go-getting attitude or the gateway to the world market and talented workforce, Italy presents an alluring prospect for those looking to leverage its distinctive business scene.
Company formation in Italy main advantages
Company formation in Italy offers several significant advantages that contribute to its appeal as a business-friendly destination:
- Strategic Location: Italy has a strategic geographical location in the heart of Europe, providing excellent access to markets in both the European Union and the Mediterranean region. This positioning allows companies to establish connections with neighboring countries, bringing into life trade and business opportunities.
- Thriving Economy: Italy possesses the third-largest economy in the Eurozone, offering a dynamic marketplace with diverse sectors. The economic diversity creates opportunities for companies across different sectors to thrive and expand.
- Entrepreneurial Culture: Italy has a rich tradition of entrepreneurship and small and medium-sized enterprises (SMEs). The country embraces an entrepreneurial culture, innovation, and business growth. This supportive environment provides wide opportunities for startups and SMEs to flourish and collaborate with established companies.
- Strong Industrial Base: Italy has a robust industrial base with a focus on innovation and technology. The country is renowned for its excellence in advanced manufacturing, automotive engineering, fashion, design, and luxury goods. This strong industrial foundation creates synergies and opportunities for companies to collaborate and benefit from established supply chains and networks.
- Infrastructure and Connectivity: Italy boasts a well-developed infrastructure network, including modern transportation systems, ports, and logistics hubs. These facilities facilitate the smooth movement of goods and services both domestically and internationally, enabling efficient distribution and access to global markets.
- Government Support and Incentives: The Italian government provides various incentives and support programs to encourage business growth and investment. These include grants, tax credits, and funding opportunities for research and development, innovation, and regional development projects. Taking advantage of these initiatives can provide companies with a competitive edge and financial benefits.
- Cultural and Lifestyle Factors: Italy’s rich cultural heritage, world-famous cuisine, and unparalleled lifestyle appeal to individuals and businesses alike. The country’s vibrant cities, beautiful landscapes, and renowned artistic and cultural treasures make Italy an attractive place to live, work, and do business.
By capitalizing on these advantages, companies that choose to establish themselves in Italy can position themselves for growth, innovation, and access to both European and global markets.
Main company types in Italy
- Limited liability company (SrL)
- Joint Stock Companies (SpA)
Main features of a Limited liability company SrL
- Ideal format for small to medium businesses
- minimum share capital is €10,000
- accounts to be filed annually
- No restrictions of foreign investors
In Italy, there are two mains types of limited liability companies;
- Private Limited companies by Quotas including Traditional S.r.l or Simplified S.r.l.
- Public Limited Companies by Shares
Main features of a Joint Stock Company(SpA)
- Minimum 1 director
- Ideal for medium to large companies
- The minimum share capital is €120,000
- No restrictions of foreign investors
- Accounts to be filed annually with the Registrar of Companies
Taxation system
Taxation system
Italy operates under a complex tax system that includes various taxes imposed at the national, regional, and local levels. Here are some key aspects of the tax system in Italy:
- Income Tax: Individuals in Italy are subject to personal income tax (Imposta sul Reddito delle Persone Fisiche, or IRPEF) on their worldwide income. The tax rates are progressive, ranging from 23% to 43% for different income brackets. Additional regional and municipal surcharges may apply, depending on the taxpayer’s residence.
- Corporate Tax: Companies in Italy are subject to corporate income tax (Imposta sul reddito delle società, or IRES) on their profits. The standard corporate tax rate is 24%, but reduced rates apply to specific types of income or certain regions. A regional surcharge may also be applicable.
- Value-Added Tax (VAT): Italy imposes a value-added tax (Imposta sul Valore Aggiunto, or IVA) on the sale of goods and services. There are different VAT rates applicable, including a standard rate of 22%, reduced rates of 10% and 4%, and exemptions for specific goods and services.
- Withholding Taxes: Italy imposes withholding taxes on certain types of income, such as dividends, interest, and royalties. The rates and exemptions can vary based on tax treaties and specific circumstances.
- Capital Gains Tax: Capital gains derived from the sale of assets may be subject to taxation. The tax rates depend on the nature of the asset and the holding period.
- Tax Deductions and Incentives: Italy offers various tax deductions and incentives to individuals and businesses. These include deductions for specific expenses, such as healthcare, education, and home renovations, as well as incentives for research and development, investments, and regional development initiatives.
VAT registration
VAT registration
To commence a business or engage in a professional activity subject to VAT in Italy, it is imperative to acquire a VAT number, an 11-digit code. The requirement for VAT registration applies to individuals involved in regular business operations, agricultural activities, or artistic and professional endeavors. It is obligatory to complete VAT registration before commencing any supplies. Notably, if the supplies involve the sale of goods through the internet, a distance sales VAT registration threshold of €35,000 per year is applicable. Furthermore, non-resident traders are not subject to a VAT registration threshold in Italy.
Steps of registration
Steps of registration
The process of company formation in Italy involves several key steps. Here is an overview of the general procedure:
- Reserve Company Name: Choose a unique name for your company and check its availability.
- Draft Articles of Association: Prepare the Articles of Association (Atto Costitutivo) or Bylaws (Statuto) for your company. This document outlines the internal regulations, ownership structure, and management rules of the company.
- Capital Requirements: Determine the minimum share capital required for your chosen company structure. In the case of an SRL, a minimum share capital of €1 is generally required, while other company types may have higher capital requirements.
- Open a Bank Account: Open a corporate bank account and deposit the required share capital. Obtain a certificate from the bank confirming the deposit.
- Public Notary: Visit a public notary to authenticate and legalize the Articles of Association and other necessary documents. The notary will prepare the Deed of Incorporation (Atto di Costituzione) and register it with the Companies’ Register (Registro delle Imprese).
- Obtain Tax Identification Numbers: Apply for a Tax Identification Number (Partita IVA) for your company with the local Revenue Agency (Agenzia delle Entrate). Additionally, if hiring employees, you will need to obtain an Employer Identification Number (Codice Fiscale).
- Register with Social Security: Register your company with the National Social Security Institute (INPS) if you plan to hire employees. This step is mandatory for fulfilling social security and employment obligations.
- Register for VAT: If your company is liable for VAT, register for Value-Added Tax (IVA) with the local Revenue Agency. Please see which companies need to apply for VAT in the previous part of the article
- Business Licenses and Permits: Depending on your business activities, you may need to obtain specific licenses or permits from local authorities or professional associations.
- Register with the Chamber of Commerce: Register your company with the local Chamber of Commerce (Camera di Commercio) to obtain a unique company registration number (REA) and ensure compliance with local regulations.