Business in Italy 2026: SRL company registration, taxes, and the path to a residence permit

Why entrepreneurs choose Italy

Italy is access to the EU single market, more than 60 million consumers within the country, and a reputation given by the 'Made in Italy' label. For manufacturing, fashion, food, design, and tourism businesses, this isn't an abstraction, but a real markup on the product's price.

Legally the country is predictable: company forms, taxes, and the registration procedure are described in law and uniform across the territory. A foreigner can be the sole owner of an Italian firm - no local partner or residence permit is needed for this. The company can also be managed from abroad, though for a number of operations (bank, tax reporting) it's more convenient to have a local accountant and address.

It's important to separate two concepts right from the start. Registering a company in Italy is about business. A residence permit is a separate status that the firm itself doesn't grant. There's a connection between them, and we'll break it down below, but they shouldn't be confused.

Business in Italy for Russians: what to consider

For citizens of Russia and other CIS countries, opening a firm in Italy is realistic and legal, but there are specifics better known in advance.

The reciprocity principle is met- Russians register an SRL on general grounds, business ownership isn't closed off to them.

A Schengen visa.To be personally present at the signing or handle business in the country, a valid Schengen visa is needed; some steps can be done remotely by power of attorney.

Enhanced compliance.Banks and notaries check the origin of funds and the ownership structure more closely. All operations proceed strictly within EU legislation, with no circumvention of current restrictions and sanctions - this is a fundamental point.

A second citizenship and residency aren't the same thing.Opening a firm and even getting a residence permit doesn't automatically make you a tax resident and doesn't take away your previous citizenship. Russia allows a second citizenship with notification to the Ministry of Internal Affairs (roughly within 60 days). And where to pay taxes is determined by the actual center of vital interests and the number of days of stay.

The main principle: transparency. A clean structure and a clear source of money remove 90% of the difficulties.

Common mistakes when opening a firm

Experience shows entrepreneurs trip up on the same spots.

Counting on a '1-euro firm' with no cushion.Formally the capital can be symbolic, but for the bank and counterparties this is a signal of weakness, and the mandatory reserve will still need to be formed from profit.

Expecting the business to automatically give a residence permit.This isn't the case: resident status is arranged separately, and it needs to be planned in advance, not after company registration.

Underestimating the accountant's role.In Italy a commercialista is essentially mandatory: reporting, VAT, contributions - all on them. Saving here turns into fines.

Poor preparation for opening an account.Without a transparent history of the origin of funds, the bank will delay or refuse. Documents are best gathered before filing.

Buying real estate counting on a residence permit.Italy has no 'golden visa for real estate' - buying a house on its own doesn't give a residence permit. This is a common misconception.

What about real estate and the 1-euro houses

Since we're on the topic of misconceptions, let's clarify the real estate topic, it's often tied to business.

Foreigners, including Russians, can buy real estate in Italy on the same reciprocity principle as registering companies. But let's repeat the key point: buying housing or a commercial property doesn't give a residence permit. There's no 'golden visa for square meters,' like in some other countries, in Italy.

The famous 1-euro houses in small towns (borghi) are real, but not a gift. The buyer commits to renovating the building within a set term and puts down a deposit lost upon non-compliance. It's essentially an investment in restoration, not cheap real estate.

Buying comes with its own taxes - a registration fee or VAT depending on the seller and property type, plus notary services. The annual property tax IMU isn't charged on a single main residence, but is paid on a second and subsequent property.

Bottom line: where to start

Opening a business in Italy is a clear but multi-step process where details decide everything. Let's put the main points into a short plan.

Decide on the form:for most people - SRL, for a budget solo start - SRLS.

Prepare the base:a codice fiscale, a legal address, a transparent history of capital.

Go through registrationthrough the notary and the Registro Imprese, get the partita IVA - roughly in 3-4 weeks.

Budget for taxes:IRES 24%, IRAP about 3.9%, IVA 22% - and a mandatory accountant.

Decide the status question in advance:if you're planning to relocate, choose between the self-employment residence permit and the investor visa, not counting on the firm to give status on its own.

The most common mistake is acting fragmentedly: first open the company, then think about the visa, then about the bank. It's more correct to design the 'business plus taxes plus residence permit' pairing from the very start. If you want to go through this path with no redoing, start with the program on Italy's residency through investment- it collects legal routes for different budgets.

What company forms exist: SRL, SRLS, SpA

For small and medium business in Italy there are three common forms.

SRL (Societa a Responsabilita Limitata)- a limited liability company, a direct equivalent of a UK Ltd or a US LLC. This is the workhorse of Italian business: participants' liability is limited to their contribution, a single founder is allowed, shares are freely distributed. Suits trade, services, and manufacturing alike.

SRLS (SRL semplificata)- a simplified version of the SRL. Capital - from 1 euro, a standard-form charter, no notary fee for formation. Available only to individuals. A convenient entry for a startup with a small budget, but the standard charter doesn't allow fine-tuning terms between partners.

SpA (Societa per Azioni)- a joint-stock company with a minimum capital of 50,000 euros. This is a format for big business, attracting investors, and going public. For most foreign entrepreneurs it's excessive.

In 95% of cases a foreigner's choice is between SRL and SRLS. Further in the article, by 'firm' we'll mean SRL specifically.

How much capital is needed for an SRL

There's a lot of confusion here, so let's lay it out piece by piece.

Formally the SRL's minimum registered capital is 1 euro. But there's a nuance: if the capital is less than 10,000 euros, the company is obligated to set aside part of the profit into a mandatory reserve, until the reserve together with the capital reaches this threshold. That is, a '1-euro firm' is technically possible, but in practice for a serious business, capital of about 10,000 euros is usually formed - this looks more solid both for the bank and for counterparties.

Upon formation, at least 25% of the cash contribution needs to be made (and 100% with a single founder). The rest can be added later.

SRLS is a separate story: capital from 1 to 9,999 euros, and it must be paid in full in cash upon formation. But there's savings on the notary.

Capital isn't 'frozen' money. After registration it sits in the company's account and is spent on its operation: rent, salaries, purchases. It's not a deposit or a security.

What a foreigner needs before registration

Before going to the notary, a foreign founder needs to gather a basic set.

Codice fiscale- an Italian tax code (the equivalent of a tax ID). Without it you can't open a company, a bank account, or sign most documents. It's issued free at the Agenzia delle Entrate tax office or an Italian consulate abroad.

International passportand, for non-EU citizens, a valid visa or residence permit if the founder plans to be in Italy.

The company's legal addressin Italy - this can be an office, a coworking space with registration rights, or an address from a specialized provider.

Partita IVA- a VAT payer number and at the same time the business's 'passport' in the tax system. It's obtained upon company registration; without it not a single invoice can be issued.

A non-EU citizen is allowed to register an SRL on the reciprocity principle - if their country allows the same for Italians. Russia has such reciprocity, so Russians open firms in Italy on general grounds. But this concerns specifically owning the business, not the right to live and work in the country - a separate status is needed for that.

Registration step by step: the notary and the Registro Imprese

Opening a firm in Italy is a sequence of clear steps. The key figure of the process is the notary (notaio), without them you can't form an SRL.

1. Preparing the charter and founding act.The Atto Costitutivo (founding act) and Statuto (charter) describe who the founders are, the amount of capital, who the director is, what the company does.
2. Signing at the notary.Founders sign documents in person or through a proxy under a notarized power of attorney with an apostille. Italy also allows remote signing via a secure video channel - this removes the need to fly to the country.
3. Contributing the capitalto the temporary account (minimum 25% or 100% with a single founder).
4. Filing with the Registro Imprese.The notary electronically sends the documents to the Business Register at the Chamber of Commerce (Camera di Commercio). From this moment the company legally exists.
5. Tax registration:assignment of the partita IVA, VAT registration, registration in the INPS social insurance system and INAIL insurance.

On timelines: from signing at the notary to registration in the register usually takes a few business days, and the whole 'from scratch to a working firm' cycle takes roughly 3-4 weeks.

How much it costs to open and maintain a firm

Expenses are divided into one-off (launch) and recurring (upkeep).

When forming an SRLbudget, roughly: the notary fee, government and registration fees of the Chamber of Commerce, a stamp duty. In total the first year, accounting for the notary, taxes, and mandatory accountant, often comes to a range of roughly 4,500-9,000 euros - the exact figure depends on the region and the structure's complexity.

For SRLS the entry is cheaper: no notary fee for the standard charter, and registration fees are minimal - roughly around 200-300 euros.

Add an accountant (commercialista) to the regular expenses - in Italy their services are essentially mandatory, as well as INPS contributions and annual reporting.

Business taxes in Italy: IRES, IRAP, IVA

The tax burden on a company consists of several components.

IRES- corporate income tax, rate 24%. The company's net profit is taxed. Resident firms pay IRES on worldwide income, non-resident ones - only on income from Italian sources.

IRAP- a regional tax on production activity, base rate about 3.9%. Regions have the right to adjust it slightly. Combined with IRES, the effective corporate burden comes to roughly 27.9%.

IVA (VAT)- standard rate 22%. There are reduced rates of 10%, 5%, and 4% for certain categories of goods and services (food, medicine, books). VAT is paid by the end consumer, and the company acts as an agent collecting and remitting it.

The 2026 budget law added investment incentives - increased depreciation for equipment investments and a number of relief measures. Specifics for your industry should always be checked with a local accountant, since details change annually.

An entrepreneur's personal income is taxed separately: income tax IRPEF is progressive, up to about 43%. More on personal taxation and special regimes - in our the breakdown of taxes in Italy.

Bank account and the company's operation

After registration the firm needs a checking account at an Italian bank - the temporary capital is transferred to it and all operations go through it. This is where the most sensitive stage awaits foreigners.

Banks in Italy, as across the EU, run an enhanced client check (KYC) and check the origin of funds. You'll need: founding documents, the codice fiscale of all beneficiaries, proof of address, a description of the business and the source of money. For entrepreneurs from Russia and the CIS the check is usually deeper - this isn't discrimination, but a compliance standard uniform for all 'new' markets.

Advice: prepare a transparent and documented history of the origin of capital in advance. A clean, clear source of funds is what opens the account, while a murky structure is what blocks it.

In parallel the company registers with the social funds (INPS) and, when hiring employees, arranges employment relations under Italian law.

Business and a residence permit: how the firm relates to relocation

The main warning here: opening a company on its own doesn't give a residence permit in Italy. You can own a firm while remaining a non-resident. But if the goal is to relocate, the business becomes a foundation for one of the legal paths to a residence permit.

A self-employment residence permit (lavoro autonomo).This is a visa for those running their own business in Italy or working as a director of their company. It's issued within the annual quotas of the flows decree (Decreto Flussi), and there are few spots for the self-employed - you need to file on strictly designated days (click day). The route works, but requires precise planning and fast filing.

An investment residence permit (investor visa).If you're ready to invest capital, this is the most predictable route: 250,000 € in an innovative startup, 500,000 € in an operating Italian company, 2,000,000 € in government bonds, or 1,000,000 € in a charitable donation. The process starts with online Nulla Osta approval, with no residence requirement at the start, the residence permit is issued for 2 years with a 3-year extension. Details - in our article on Italy's investor visa.

There are also paths not directly tied to business: the visa for the financially independent and other residence permit groundswe break down separately. And for affluent entrepreneurs relocating their tax residency, the flat tax regime for new residents is of interest.

The choice of route depends on your goal, budget, and timelines - and it's exactly here that it's useful to build the 'business plus status' pairing in advance, rather than acting blindly.