Company formation in Italy

• VAT registration service available. Normally registration takes 40 days.
• Minimum share capital is: €10,000
• Minimum number of directors is one.
• No restrictions on foreign shareholders.
• Annual tax return and VAT filed quarterly plus annual audit.
• Codice Fiscale required for each foreign director and shareholder
• Personal visit to Milan is required to open Bank account in Italy.
• Shelf Companies with VAT available. Ask now.

LIMITED LIABILITY COMPANY (S.r.L.) FOR TRADING

Most popular format for businesses in Italy is S.r.L., Limited Liability Company.
The standard rate of Italy corporate tax (IRES) is 27.5%%. In addition, local tax (IRAP) is imposed at a rate of generally 3.9%, bringing the effective tax rate to 31.4%.

Government duty €310 and Chamber of Commerce duty €200 must be paid annually.

For new companies VAT registration is usually manageble. Please note that it might take up to 40 days.

[/tab][tab title="Branch office"]

REPRESENTATIVE OFFICE OF A FOREIGN COMPANY & BRANCH OFFICE

“Light Branch” is a type of Representative Office registered at the Labour Office and authorized to employ and to use an Italian bank account. A Light Branch cannot trade, issue invoices or to have VAT. However, it is a very cost effective tool for promoting services in Italy. As soon as the entity needs to start trading activities, the Light Branch should be upgraded to a Branch.

An Italian branch can be used as a trading partner to import / export or buy / sell within the EU and beyond its borders. The Italian branch can have a VAT number obtain a tax residency certificate.

Chamber of Commer duty €200 must be paid annualy.

Key advantages:

• Only one director required, who can be citizen of any country
• EU company with EU VAT number is required for Head Office Company
• Codice Fiscale required for parent company (Italian tax reference number), each director of parent company and representative of the branch
• Accounts should be maintained at the physical business address, but there are no reporting requirements or regular audits for representative offices.
• Trading Branch offices are liable for taxes on Italian source income
• There is no branch remittance tax.

Contact us for Formation costs. Or ask for alternative application.

[/tab]/tabs]

• CORPORATE INCOME TAX (CIT): The standard rate of Italy corporate tax (IRES) is 27.5%%. In addition, local tax (IRAP) is imposed at a rate of generally 3.9%, bringing the effective tax rate to 31.4%. Non-operating companies pay 38% CIT on “estimated income”.
• INCOMING DIVIDENDS. 95% of dividend income is tax exempt with no minimum holding period. Participation exemption does not apply with offshore jurisdictions.
• CAPITAL GAINS TAX (CGT). Capital Gain from sales of shares are generally taxed at 27.5% rate. Under specific conditions 95% participation exemption can apply.
• WITHHOLDING TAX:
  ROYALTIES: 22.5%, which can be reduced under tax treaty or EU Directive on Royalties.
  DIVIDENDS: 20%, which can be reduced under tax treaty or EU Parent Subsidiary Directive.
  INTERESTS: 20%, which can be reduced under tax treaty or EU Directive.
• VALUE ADDED TAX (VAT). EU VAT regime. The standard rate for inland sales is 23%. VAT rate might increase in 2013 to 23,5%.
• BILATERAL TAX TREATIES with 75 countries including Cyprus, Singapore and Malta.

• Chose the structure that fits your business. Need help? Contact us.
• Contact us for Company Package Fees.
• Follow our Compliance Policy