How Much Does It Cost To Start A Business In Italy?
A lot of entrepreneurs register their businesses in Italy every year because of the various advantages of registering a company in Italy. However, while setting up enterprises in Italy, entrepreneurs often wonder how much does it cost to start a business in Italy?
When a new business is established or an existing firm is operating, it requires a significant amount of capital to conduct its daily operations. As such, entrepreneurs should know the cost to start a business in Italy. Entrepreneurs can plan out their businesses more effectively and reduce the likelihood of losses in the future by being aware of the costs.
There is various cost for starting a business in Italy as a foreigner. Any enterprise, be it Italian or foreign, has to pay for registering a business, doing a trademark registration, acquiring licenses, etc. This article will briefly discuss the cost to start a business in Italy.
Factors that affect the cost for starting a business in Italy as a foreigner
The cost for starting a business in Italy as a foreigner or as a resident is approximately 5650 euros in the first year, and 1850 euros per subsequent year. The average cost to start a business in Italy is 14,150, which covers other costs such as opening a business bank account, hiring a business secretary, establishing a physical registered office, etc.
The cost for starting a business in Italy as a foreigner depends on various factors.
Some of the factors are described below:
- Company incorporation expenses– The company incorporation fee in Italy is approximately 2300 Euros.
- Trade Register Expenses– A company has to be registered with the local Trade Register which can cost about 520 euros.
- Trademark registration expenses– The categories in which the trademark is to be assigned heavily influence the price of trademark registration in Italy. A trademark registration for a specific category of products and services must be filed for €200. An additional cost of €34 has to be made for each additional category of products listed in multi-class trademark registration.
- Local office address- In order to have a local registered address, the fees for acquiring land, or renting property must be paid.
- Virtual office requirement expenses– If a business does not have a locally registered office address, the business has to apply for a virtual office which can cost approximately 100 euros monthly.
- Accounting expenses- Based on the number of bills and annual revenue of the firm, accounting costs begin at EUR 130 on a monthly basis.
- Licenses expenses- In order to operate a business in Italy, entrepreneurs are required to acquire licenses and permits of different kinds. However, the cost of acquiring business licenses, depends on the type of business the entrepreneur is going to establish.
- Registering with the Tax Authority- In order to pay tax, the company must register its business with the relevant tax authorities. The company also has to register for VAT in Italy.
- Opening a bank account fees- The company has to open a bank account in Italy for its business to deposit the minimum share capital. The cost to establish a business bank account varies depending on the different banks.
- Depositing the minimum share capital- The company has to deposit the minimum share capital in the bank. The minimum amount of capital for a limited liability corporation, or the S.R.L, ranges from 1€ & to 10,000€. At least a share capital of €50,000 is needed to form a joint stock company.
- Registering for social security- The company has to register for social security purposes.
- Monthly and annual costs- The cost to start a business in Italy also consists of monthly and annual costs.
Cost to start a business in Italy for different business types
A future as a businessman is something that more and more people want. However, it is not particularly simple to start a business in Italy. To accomplish the desired goals, planning is necessary. A budget that is big enough to pay for the initial expenses must be considered.
This section of the article will focus on the various cost to start a business in Italy.
1. Private Limited Company or S.R.L Company
The cost to start a business in Italy for an S.R.L Company varies depending on several factors such as the registration fee, minimum share capital, acquiring the necessary licenses and authorizations, etc.
An Italian SRL corporation must be incorporated via a public deed signed in front of a notary. The fee for the notary depends on the amount of the firm’s share capital. The minimum amount of capital for a limited liability corporation, or the S.r.l., ranges from 1€ & to 10,000€. Contributions should be provided entirely at the time of subscription and should only be done in cash whenever the capital is up to the maximum worth of 10,000 euros.
Whenever the share capital exceeds 10,000 euros, the directors must get a minimum of 25% of that amount, or 2,500 euros.
2. Joint Stock Company
A threshold amount of 50,000 euros is required to start a joint-stock corporation, and the amount must be specified in the articles of association.
A stockholder’s holding of stock need not necessarily correspond to his total investment in the business. 25% of the share capital should be provided when the articles of association are signed, with the remaining funds to be contributed at a later time.
When a sole stockholder forms the firms, the share capital must be provided as a whole. All non-cash support provided in kind must be fully reimbursed.
3. Limited Liability Company (GmbH or UG)
A limited liability company may be established in Italy by registering the business with the relevant authorities.
In order to start a GmbH or UG, entrepreneurs will have to register with the following authorities:
- Commercial register (Handelsregister)
- Trade office (Gewerbeamt)
- Tax Department (Finanzamt)
- Chamber of Industry and Commerce, based on the firm’s commercial operations
- Trade organizations (Berufsgenossenschaft)
- Agency for Employment (Agentur für Arbeit)
In addition to notary fees, company registration fees will vary from €20 to €60, and entrance into the Handelsregister would charge €150.
The notary’s department would want evidence of a deposit of €25,000 for a GmbH in share capital or if you’re establishing a UG, a minimum of €1 in order to finish the commercial register request once the company bank account is created.
4. Sole Proprietorship
The simplest, quickest, and least expensive method to launch a company in Italy is as a sole proprietorship. A sole proprietorship lacks limited liability, making the owner fully responsible for the business’s debts along with all of his possessions.
In order to form a sole proprietorship in Italy, entrepreneurs will have to pay for the following expenses:
- Registering for a VAT number that the Italian Inland Revenue Agency would provide.
- Registration fees of the sole proprietorship with the Italian Business Register.
- Registration with Social Security.
- Registration costs for insurance.
- Opening a bank account in Italy.
- Depositing the minimum required capital.
5. Branch Office
A branch office is a representative of a foreign company headquartered in some other nation. For establishing a branch office, an entrepreneur will have to consider the various cost to start a business in Italy.
Here are the various factors that will affect the cost for starting a business in Italy as a foreigner:
- Registration fees for establishing a branch office.
- Fees for acquiring a physical office address.
- Expenses for creating a business bank account in Italy.
- Governmental registration expenses.
- Registration expenses for TAX purposes.
- Annual accounting expenses.
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Whenever an entrepreneur considers establishing a business, the entrepreneur has to consider the various cost to start a business in Italy. The cost for starting a business in Italy as a foreigner depends on various factors like registration expenses, acquiring virtual office expenses, registering for tax purposes, business location, the type of firm etc.
The article above has discussed the expense of launching a business in Italy which can assist you in making the accurate choice and preparing appropriately for potential difficulties that may arise while launching a firm. For more queries, you can consult Odint Consultancy. Our experts will help you solve your queries.
- Company incorporation expenses
- Trade Register Expenses
- Trademark registration expenses
- Local office address
- Virtual office requirement expenses
- Accounting expenses
- Licenses expenses
- Registering with the Tax Authority
- Opening a bank account fees
- Depositing the minimum share capital
- Registering for social security
- An Italian SRL corporation must be incorporated via a public deed signed in front of a notary in order for it to be established. The fee for the notary depends on the amount of the firm’s share capital.
- The minimum amount of capital for a limited liability corporation, or the S.r.l., ranges from 1€ & to 10,000€.
- Contributions should be provided entirely at the time of subscription and should only be done in cash whenever the capital is up to the maximum worth of 10,000 euros.
- A limited liability company may be established in Italy by registering the business with the relevant authorities. In addition to notary fees, company registration fees will vary from €20 to €60, and entrance into the Handelsregister would charge €150.
- The notary’s department would want evidence of a deposit of €25,000 for a GmbH in share capital or if you’re establishing a UG, a minimum of €1 in order to finish the commercial register request once the company bank account is created.
Businesses that desire to establish a company in Italy must submit a request to the Chamber of Commerce in the country.
Certainly, obtaining licences and permits are required to operate a business in Italy. However, it depends according to the nature of the firm and the sector, which could result in additional expenses.
Yes, you may launch a business in Italy as a non-resident. However, you will have to fulfill necessary criteria and apply for appropriate permits in order to launch a business in Italy as a non-resident.
Reshma Ali has great expertise in mergers & acquisitions, Financial planning, and international company formation and offers advice and knowledge to help businesses achieve their objectives.