• Marco is a dedicated and motivated professional, with several years of successful international legal experience. Specifically he has experience in the Italian, English and French legal systems having spent time working in law firms in each country. Marco is a native Italian speaker and is also fluent in English and French. Marco provides international clients with expert advice and assistance in matters of property and business as well as any legal issues relating to fine art.
      Testimonials for Marco
      • Michael Morgan
        Michael Morgan, Padova

        Marco was able to resolve my problem within 10 days, where it took me over 2 months getting nowhere with the facility we bought our Murano set in Venice, Italy.


        Nov 01, 2019
      • Chris Rye
        Chris Rye, Chelmsford, England

        On occasions it took a little longer than we had hoped in obtaining a reply, however we do appreciate and understand that this was probably due to being away from the office, possibly in Court, or with other clients - not a criticism just an observation.


        There are no improvements we can suggest,  save to say, we would use Marco in the future if required.


        Oct 29, 2019

Register a Company in Italy

Assuming you have already decided on the type of business you want to run and where in Italy you wish to locate it, then the main decision you will need to make is whether you should set it up as a limited company or as a sole trader.

This can be extremely important as you can save a considerable amount of money depending on which option you choose. Both have benefits and drawbacks. Here we will look at the differences between the two so that you can decide on which is the most appropriate – and cost effective – before you register a company in Italy.

 

Sole Trader v Limited Company

Sole traders in Italy are known as ‘autonomis’ and those who are just starting-out and where the income is likely to be low tend to choose this route.

Why?

Mainly because it is less complex and more economical to both set-up and  run. Accountants will normally charge 50% to manage compliance and tax returns in comparison to a limited company, given the lower administrative requirements.

 

Fiscal Obligations

As in other countries, whether your business is classed as ‘autonomi’ or as a limited company there are a number of fiscal obligations that the owner of a business in Italy will have.

Most larger businesses will have an obligation to make VAT (in Italy this is called IVA) and Income Tax returns. Of course if you decide to create a limited company then you will also have to make a company tax return (impuesto de sociedades) as well as file the annual accounts with the Company’s Register.

A company will need to retain up to 15% of any invoice presented to it by a professional/autonomo and file a return.

These extra obligations mean that the cost of maintaining the company are higher than where a sole trader is concerned.

 

Income/Corporation Tax

For sole traders, the income tax rate varies depending on income (from 23% to 40%). For small entities with revenues up to about 30.000 euros (the limit may vary according to activity) you can opt for a special regime called forfettario which allows you to pay just 15% tax and do not apply VAT (IVA in Italy).

As for limited companies, two different taxes apply, with a different tax base. The first one called Ires is now 24%, the second one called Irap varies between 3,9 to 5%. It is quite a complex system, with a lot of special cases and exceptions.

Social Security Obligations

As an autonomo or sole trader you will need to register with the local social security office and pay contributions each month. These contributions tend to be significantly higher than in other northern European countries with a current minimum of approximately €2800-3000 per year payment for commercial activities (for example shops, agents, manufacturing etc), or a fixed rate on income for consultants/professionals that varies each year and is currently approx. 26%, .

There are some reductions for those under 30 years of age or a temporary discount for example where the person has been unemployed and has decided to become self-employed.

In the case of a limited company there is an obligation to make social security contributions on behalf of an employee of 24% of their income. Where there are no employees of the company i.e. a single director company then that director must register as an autonomo and pay those social security contributions.

 

Liability

Just as elsewhere, one of the major differences between the two forms of business is that creating a limited company ensures limited liability to the owner of the company. If as a result of the operation of the company a financial liability should arise, then often this is limited to the amount of capital in the company.

As a matter of law in Italy the minimum level of capital that any company can have at any time is set at €3000 though this is sometimes disregarded by less scrupulous business owners.

One of the major drawbacks of registering as an autonomo is that you will be personally liable for any debts or losses incurred by your business and any personal assets could be at risk if your business is in financial trouble – either as a result of damages owed to a client or failure to pay due taxes and social security contributions.

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