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Company Formation Italy

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Articles

Company Registration in Italy - COST-EFFICIENT!

Updated on Friday 10th June 2022

LEXIA Avvocati provides company incorporation and other legal services in Italy through its five offices and employs more than forty lawyers. LEXIA provides complete company formation services, as well as many other types of services, suited to all types of companies. Specialization is important and our team is dedicated to providing complete services in a number of areas including corporate, startups, tax, labor, insolvency, trust and asset protection as well as new technologies such as fintech.
 

 Quick Facts  
  Types of companies

Limited liability company (S.r.l.)

 Simplified limited liability company (S.r.l.s)

Innovative start up

Sole proprietorship

Public limited company by shares

Partnership

Cooperative corporation

Benefit corporation

Minimum share capital

for LTD Company 

EUR1

Minimum number of

shareholders for Limited Company 

 there is no minimum number,

1 shareholder suffices

Time frame for the incorporation 

5-7 working days

Corporate tax rate

24% corporate tax rate (IRES) +

3,9% regional tax rate (IRAP) = 27,9%

Dividend tax rate 

- dividends received from resident companies are taxed on a taxable base of 5%;

- dividends received from companies located in countries with a preferential tax system are fully taxable;

- dividends paid to companies based in member states of the EU and in members of the EEA that allow a suitable exchange of information with Italy are taxed at source (WHT) at a rate of 1.2%

VAT Rate 

- standard VAT rate = 22% 

- reduced rates = 4% - 10% 

Are Shelf Companies Available?  Yes 
Do you supply a Registered Address/Virtual Office?   Yes, at 1,200 Euro per year
Local Director Required   No, unless the condition of reciprocity between countries is given. 
Annual Meeting Required  Yes. The annual meeting can also be held virtually or in the form of written resolutions.
Redomiciliation Permitted  Yes 
Electronic Signature  Yes 
Is Accounting/Annual Return Required?  Yes 
Foreign-Ownership Allowed  Yes (percentage up to 100%), however subject to the condition of reciprocity between the respective countries.

 

Awards and organizations we are part of

 
LEXIA lawyers received a number of distinctions and are also recognized partners for a number of organizations. We list them below:
 
Top Legal Awards 2018: LEXIA Avvocati was nominated as a finalist for the law firm of the year in the innovation category and the law firm of the year, after its head, Alessandro Dagnino, was nominated as the best professional for litigation before the Supreme Court,
 
Top Legal Awards 2016: LEXIA Avvocati was nominated for the Most innovative law firm in Italy in 2016.
 
LEXIA Avvocati is partner of the Italian Stock Exchange “Elite Program” – in April 2018, the law firm became a partner of ELITE, a Borsa Italiana platform dedicated to Italian SMEs that will be listed with the Stock Exchange;
 
LEXIA Avvocati is partner of “Invest in Lombardy”, the Government Agency of the Lombardy Region – the law firm became the legal partner of “Invest in Lombardy” in 2017 for the purpose of assisting foreign companies that want to operate in the region. 
 
The company is also present on the International Comparative Legal Guides – a website offering comprehensive guides for fifty practice areas, in more than 180 jurisdictions.   
 
LEXIA Avvocati is a also a member of The British Chamber of Commerce for Italy.
 
Below, our team describes the company formation process in Italy as well as the general conditions for company formation.
 

Steps for company formation in Italy

 
A limited liability company can be incorporated following a few steps: 
 
  1. Registration with Italian Tax Authorities – there is necessary to obtain a tax identification number (codice fiscale);
  2. Execution of the articles of association with a public notary – this is an obligation for the shareholders and it can be done personally or through a power of attorney;
  3. Obtain the VAT number – this is issued by Agenzia delle Entrate after an online request;
  4. Obtain the certificate of incorporation – after filing all the documentation required;
  5. Open a bank account for the company.
 

How to open a company in Italy

 

Our company registration agents in Italy can assist you throughout the company incorporation procedure. The first step for company formation in Italy is preparing and drafting the necessary company documents, such as:
 
  • - the articles of association,
  • - specimen signatures of the company directors,
  • - affidavits,
  • - others.
You will also need to open a bank account for the company, where the minimum required share capital will be deposited. The business start-up costs can vary according to the type of company and the materials and equipment required for your specific business activity. Your company will also need an accountant that will make sure you comply with the requirements for accountancy in Italy. Our company formation experts can help you with professional accounting services.
 
 
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Types of companies in Italy

 
There are several types of legal entities available for those interested in company formation in Itay:
 
  • - the limited liability company, which can be traditional of simplified;
  • - the joint-stock company, also known as public limited liability company;
  • - the general partnership, which must have at least two members called partners;
  • - the limited partnership, which must be formed by a general and a limited partner;
  • - cooperative, which is not exactly a type of company, but more of an organization employed by those who want to operate in the agricultural industry;
  • - sole proprietorship, which is the simplest form of doing business in Italy.
The limited liability company is a business type preferred by investors who want to start a small or medium scale business. This is the most popular business form in Italy. The new company registered in Italy will be managed by a director or a board of directors who will follow the company’s articles of association. The financial issues will be managed by statutory auditors and the representatives in charge with financial business will keep a list of financial statements and balances. 
 
The joint stock company is chosen by those investors who want to run a large business. The minimum share capital for this legal entity is 50,000 EUR and at least a quarter of this amount must be paid upon incorporation. The joint stock company is managed by a director or a board of directors. The shareholder’s liability is limited to the number of contributions made to the share capital.
 

Business forms available for foreign companies in Italy

 
Foreign companies are encouraged to choose company formation in Italy by registering one of the following types of structures:
 
  • branch offices which are legal entities depending entirely on the parent company;
  • - light branch offices which can only be found in Italy and which allow for certain activities;
  • - subsidiaries which are independent entities can which can be created as limited liability companies;
  • - representative offices which are not legal entities, but can help foreign companies determine if the Italian market is suitable for them.
Our company registration advisors in Italy can help the representatives of foreign companies choose the right structure for their companies.
 
We invite you to watch a video about how to register a company in Italy:
 
 

 

Documents needed for company formation in Italy

 
Both local and foreign investors need to consider the preparation of the following documents for company formation in Italy:
 
  • - their personal information is required – the ID or passport are the main documents needed;
  • - in the case of foreign companies, the Certificate of Registration and the incorporation documents are also required;
  • - the Italian company’s establishment documents are needed – these will be drafted by an Italian public notary;
  • - depending on the type of company, other documents could be required.
We can help foreign investors who need to have the Articles of Association for new companies drafted and notarized. If you want to open companies in other countries/regions, such as Bulgaria or Dubai, we can put you in touch with our partners. 
 

Costs for company formation in Italy 

 
The main costs related to incorporating a company in Italy are: 
 
  1. Trade Register fee – EUR520 (this fee will be paid for registering a company with the local Trade Register);
  2. Virtual office – EUR100/month (this is necessary if you don’t have an office for your business);
  3. Incorporation fee – approx. EUR2,300;
  4. Accounting fee – starting from EUR130/month, depending on the number of invoices and yearly turnover;
  5. Minimum share capital – EUR 1 for a limited liability company and EUR 50,000 for a joint stock company.

 

The company incorporation procedure in Italy

 
The company incorporation procedure in Italy is not very difficult and is similar to those in other countries. An application for registering the company must be made at the Italian Trade Register and, after the application is processed, a registration certificate is issued for your new company.  
 
Another obligation for the foreign investor in company formation in Italy is to execute a public deed of incorporation at the notary office, buy the corporate and accounting books and pay a government grant tax. 
 
The investor must also submit an application to the Register of Enterprises in order to obtain a tax identification number and a VAT number. The company must also be registered with the Social Security Administration. In order to hire employees in Italy, an entrepreneur will need to observe the provisions of the Labor Law and announce the employment to the Labor Office. 
 
Our company formation agents in Italy can give you detailed information about the steps required to set up a company in Italy. We can provide you with complete assistance and advice if you want to start a business.
 

Opening a company bank account in Italy

 
One of the most important aspects of opening a company in Italy is related to the establishment of a corporate bank account. This account is needed for depositing the share capital and for conducting commercial activities.
 
 
  • - submitting the company’s incorporation documents with the chosen bank;
  • - completing the necessary paperwork issued by the Italian bank;
  • - appointing a company representative who will keep in touch with the bank;
  • - choose the services which best suit the need of the Italian company.
Apart from the company bank account, a business can also create merchant accounts for accepting online payments. These types of accounts are mostly used by e-commerce companies, such as online stores, in Italy.
 
Our Italian company formation representatives can help foreign entrepreneurs choose the right type of structure for their businesses here and can represent them in the procedure for opening the bank account.
 

Common questions about the company registration process in Italy

 
Italy is very appealing to foreign enterprisers who usually have many questions related to the requirements and process related to company formation in Italy. Among these questions are:
 
  1. Can I register the company as a sole shareholder, even if I am a foreigner?
Yes, full foreign ownership is possible in Italy even for single shareholders. Among the types of structures, foreign enterprisers can use are the sole proprietorship and the private limited liability company.
 
  1. What is the minimum amount that I need to set up the company?
It depends on the type of company you want to establish: in the case of the private limited liability company, you will need 1 euro, while in the case of a public company, the new requirement is 50,000 euros.
 
  1. Can I register my company remotely?
Yes, remote company registration is possible in Italy, however, you must appoint a local representative and grant him or her power of attorney to complete the process.
 
  1. Does an Italian company need a resident director?
No, the law no longer requires for resident directors in Italian companies.
 
  1. How long does the company registration process take in Italy?
The usual procedure for setting up a company in Italy takes about a week, however, this timeframe will depend on how much time it takes for the documents to be prepared.
 

What are the main taxes applicable to businesses in Italy? 

 
Companies performing commercial activities in Italy are liable to taxation. A company can be taxed in Italy as long as it has a place of management or a main business activity developed in this country. Companies are liable to value added tax, corporate income tax and others as long as they have been operating in Italy for at least 183 consecutive days (in this case, the company will be seen as a permanent establishment in Italy).
 
If you are interested in opening companies in other European countries, such as MaltaCayman Islands or Russia, you can contact our specialists in company formation.

 

Meet us in Rome and Milan

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Call us now at +39 023 663 8610 to set up an appointment with Francesco Dagnino, one of our lawyers in Rome and Milan, Italy. Alternatively you can incorporate your company without traveling to Italy.

As a LEXIA Avvocati client, you will benefit from:

  • - 24 hour response time guaranteed
  • - cost- efficiency  
  • - dozens of articles and free information on the best Italian structures.
     
Contact us