Moving to Italy to Start a Business: Tips and suggestion

Moving to Italy to start a business: a Useful Guide

There is a lot to know about what is required in order to move to Italy and start a business. The country is well-known for its large and complex bureaucratic network. That being said, it is certainly not impossible and plenty of people have managed to do so. 

​What to know before moving:

The very first thing to do is to make sure that you are legally able to reside and carry out business activities in the territory. In the case of American citizens, the relations between the two countries have always been good, so this is not as big a problem as with some other countries.
 
To do this you will first need to have the proper visa issued by the Italian consulate in your jurisdiction: an entrepreneur visa is the simplest one to apply for in this case. There are a few other types of visas that accomplish a similar goal, but they have heavier requirements; if you are looking to create a start-up in Italy, there is a separate, and fairly elaborate, scheme for that. As a side note, it is worth mentioning (because it is often left out elsewhere) that when you apply for a visa, you can simultaneously apply for the Italian tax identification number called the codice fiscale. This will save some time later on.
 
The visa process requires quite a bit of time, upwards of a year. In most cases it is around six months, but it is best to plan accordingly. Let’s move on and take a look at what is needed to open a company in Italy. 

Setting up the company:

Before starting a business, it is necessary to create a business plan that will give you some kind of competitive advantage in the Italian market. You should have a clear view of what kind of activity you want to conduct. You will need to carry out a market survey by researching similar businesses in your field to determine potential customers and partners.
 
Based on that research, you can then develop a full business plan which sets out your objectives, the target market as well as commercial strategy. It should also include potential obstacles to starting the business and any financial projections.
 
Once that is done, you will have to decide on the legal structure of the company and in Italy there are a few options. The structure that you choose determines the benefits you are able to enjoy as well as your legal, financial and tax obligations. Below you will find the most common structures for companies in Italy.
 
Sole Proprietor: The advantage of running a business as a self-employed person is that it is cheap and easy to set up. Furthermore, you have full ownership and control over the business, and that all after-tax profits are yours. On the other hand, you are personally liable for all the losses your business makes, and have additional responsibilities, such as keeping business records.
 
Società a Responsabilità Limitata (S.R.L.): This type of business is the Italian equivalent of a U.S. limited liability company. Capital is divided into quotas (similar to shares) but it can not be placed into the stock exchange. This is the most common form of company in Italy.
 
Corporation (Società per Azioni): The S.p.A is the Italian form of a corporation. Capital in this case is divided into shares which can be offered for sale to the public. Liability is thus limited to the initial capital contribution made by each individual. If you want to create a company that can be listed in the stock market, this is the only option.
 
Additionally, there are several types of partnership structures, but they are far less common than the three listed above. For example, with a limited partnership (società in accomandita semplice), there are two different types of partner. General partners run the everyday business and have full joint liability; the other type, called “sleeping” partners, have a liability that is strictly limited to their initial capital contribution.
 
The next natural step is finding the perfect location. There are many real estate offices scattered around Italy, but if you happen to be in town you can also scout around on foot and take in some of the scenery. 
Check out our video about partita IVA and discover what it is and how to open it.

​Registering the Company: 

Once you have laid out your business plan and decided on the legal structure of the company, the next step will be opening a bank account. This is not so difficult as long as all of your paperwork so far is in order. It is best, however, to shop around a little and see which bank will give you the best deal. Unlike in the U.S., Italy has many smaller branch banks as opposed to the larger chains.
 
You will need a notary in order to draft a memorandum (atto costitutivo) and articles of association (statuto). The notary must be present either to draft the incorporation agreement (atto pubblico) or to certify the signatures of the shareholders (scrittura privata autenticata). After this is done and the company is registered, you will receive information from INPS, which is the social security office, and INAIL who covers accident insurance.
 
In order to set up a company at this point it will be necessary to register it, as mentioned above, at the local chamber of commerce (camera di commercio): this can be done by either yourself or by the notary. The paperwork will be in Italian so it would be helpful to have someone who is able to navigate the Italian bureaucracy; this applies to the whole process required to set up a business. After registering the company, it will officially exist. You will also receive the VAT number during this part of the process which will be necessary for all future business endeavors.

After arriving in Italy: 

​While you are running around trying to get your business up and running, it will also be necessary to register your physical presence, letting the police know that you are living in Italy, by acquiring the residence permit (permesso di soggiorno). Remember, the visa is only good for allowing you to legally enter Italy for more than three months. The paperwork can be picked up at any Italian post office or C.A.F. (centro assitenza fiscale). The C.A.F. is a non-profit and will help you fill out the paperwork for a small donation, saving a lot of time and hassle.
 
By way of conclusion, let me mention that there is yet another option. Some cities are willing to pay individuals to move there in order to open a business in Italy. The cities change depending on their population needs, but they usually offer substantial benefits, especially for companies that will create a lot of jobs. This is a good option for foreign investors as well. Check out our article about these opportunities here.
Read about this our article about freelancing in Italy, how to start a small business in Italy, the differences between SPA and SRL in Italy, and our Italian company registration guide.

Check out also our videos about shelf companies in Italy, and how to launch an innovative startups in Italy.