Company Formation in Italy: Complete Guide
Establishing a company in Italy requires technical expertise, careful planning and a solid understanding of the legal, tax and compliance obligations involved. This guide provides an in-depth, professionally structured overview of Italian business entities and the procedures required to incorporate and start operating in Italy safely and efficiently.
Studio Genise - chartered accountant firm in Milan since 1979 - assists both Italian and international entrepreneurs throughout all stages of company formation, combining tax advisory, accounting, corporate compliance and employment-law expertise.
1. Why Start a Company in Italy?
Italy offers a robust and reliable legal system, increasingly simplified by digitalised procedures. Key advantages include:
- faster incorporation thanks to digital deeds and online filings
- strong asset protection for capital companies (SRL / SPA)
- access to over 100 double taxation treaties
- a fast-growing business environment, especially in Milan
- a high level of protection for shareholders and investors
For international entrepreneurs, Italy offers a strategic entry point into the EU single market and one of the strongest industrial regions in Europe.
2. Legal Forms for Doing Business in Italy
Business can be carried out through several legal structures. Some require multiple shareholders (companies), while others allow individuals to operate without forming a separate legal person (sole proprietorship).
The choice depends on:
- liability and risk exposure
- governance needs
- tax planning
- capital structure
- regulatory requirements
Below is an overview, followed by a comparative table with UK and US equivalents.
2.1 Capital Companies (Società di Capitali)
Entities with full legal personality and limited liability:
- SRL — Private Limited Liability Company
- SRLS — Simplified SRL
- SPA — Joint-Stock Company
- SAPA — Partnership Limited by Shares
Ideal for ventures with significant financial exposure, multiple shareholders or structured governance.
2.2 Partnerships (Società di Persone)
More flexible and lightweight, but with personal liability:
- SS — Simple Partnership
- SNC — General Partnership
- SAS — Limited Partnership
Income is taxed directly in the hands of the partners (transparent taxation).
2.3 Sole Proprietorship (Impresa Individuale)
A business run by an individual with no separate legal personality.
Fast to set up, low cost, but unlimited personal liability.
2.4 Table comparing the different types of business entities
| Italian Legal Form | Description | Legal Personality | Liability | Minimum Capital | Typical Use | UK Equivalent | US Equivalent |
|---|---|---|---|---|---|---|---|
| SRL | Private limited liability company with flexible governance. | Yes | Limited | €10,000 | SMEs, subsidiaries, investments | Private Limited Company (Ltd) | LLC |
| SRLS | Simplified limited liability company. | Yes | Limited | €1–9,999 | Start-ups with limited capital | Simplified Ltd | Single-Member LLC |
| SPA | Joint-stock company for large enterprises. | Yes | Limited | €50,000 | Corporate groups, regulated sectors | PLC | Corporation (Inc., C-Corp) |
| SAPA | Hybrid company with general and limited partners. | Hybrid | Mixed | €50,000 | Niche structures | Hybrid PLC/LP | LP (with corporate GP) |
| SS | Simple partnership (non-commercial). | No | Unlimited | None | Asset management | Simple Partnership | General Partnership |
| SNC | General partnership with full liability. | No | Unlimited | None | Small local businesses | General Partnership | General Partnership |
| SAS | Limited partnership (general + limited partners). | No | Mixed | None | Small enterprises | LP | LP |
| Sole Proprietorship | Business operated by an individual. | No | Unlimited | None | Freelancers, artisans | Sole Trader | Sole Proprietorship |
3. Establishment of a capital company
3.1 Choice of corporate form
Choosing the right corporate form is a crucial step in the process and depends on several factors. For simplicity's sake, an LLC is the most common form, offering a balance between costs, protection, and flexibility.
3.2 Articles of Association and Bylaws
The Constitution requires:
- notarial deed of incorporation;
- company statute;
- capital payment;
- registration in the Company Register.
The bylaws govern governance, powers, shareholder rights, and internal rules. Customization is almost always recommended.
3.3 Share capital
- LLC: 10,000 euros
- SRLS: from 1 to 9,999 euros
- SPA: 50,000 euros
3.4 Initial obligations
- VAT number request
- PEC
- communication of beneficial owner
- INPS/INAIL registrations
- opening a company current account
3.5 Digital Constitution ("without a notary")
In Italy, it's not possible to incorporate a company "without a notary," but it can be done online via video conference and digital signature. Studio Genise does not recommend this method.
Suitable when:
- individual members;
- cash contributions;
- standard statute;
- very simple governance.
To be avoided when:
- foreign members without digital identity;
- contributions in kind;
- complex governance;
- regulated activities.
4. Formation of partnerships
The procedure includes:
- articles of association (notary or certified deed);
- registration with the Revenue Agency;
- registration in the Company Register;
- VAT number;
- INPS/INAIL if applicable.
Taxation for transparency for members (IRPEF).
5. Individual business
To open a sole proprietorship you need:
- VAT number;
- choice of tax regime;
- SCIA, if necessary;
- INPS and INAIL;
- Chamber of Commerce for activities requiring registration.
It is possible to join the flat-rate scheme (if you meet the requirements).
6. Common mistakes to avoid
- corporate purpose too generic or too rigid;
- standard statute in the presence of multiple members;
- lack of tax and contribution planning;
- unregulated relationships between partners;
- corporate form not suited to the risks;
- failure to communicate the beneficial owner.
7. How much does it cost to set up a company in Italy?
The costs depend essentially on the complexity of the project and include in the following table the notary fees, taxes, accountant's consultancy and business start-up procedures.
Table of incorporation costs
| Scenario | When it applies | Content | Estimated cost |
|---|---|---|---|
| Minimum | SRLS or standard SRL | Reduced notary fees, minimal costs, minimal procedures | €900 – €1,800 |
| Standard | LLC with customized statute | Notary + consultancy + various procedures for opening and starting a business | €2,600 – €4,400 |
| Advanced | Foreign partners or complex governance | Notary, appraisals, advanced consultancy + various practices | €5,000 – €10,000 |
8. Comparison between corporate forms
| Form | Minimum capital | Responsibility | Taxation | Advantages | Limits |
|---|---|---|---|---|---|
| SRL | €10,000 | Limited | IRES + IRAP | Asset protection | High compliance |
| SRLS | €1 – 9,999 | Limited | IRES + IRAP | Low initial costs | Non-customizable statute |
| SPA | €50,000 | Limited | IRES + IRAP | Solid structure | High costs |
| SNC / SAS | Nobody | Unlimited / mixed | IRPEF | Lean management | Personal risk |
| Individual business | Nobody | Unlimited | IRPEF / Flat Rate | Quick Start | Full responsibility |
9. Frequently asked questions
How long does it take to open a company?
On average between 10 and 20 working days .
Average formation times
| Type of constitution | Average times | Notes |
|---|---|---|
| SRL / SRLS | 10–20 working days | Variables for foreign members or complex statute |
| SPA | 15–25 working days | More complex procedures |
| SNC / SAS | 7–15 working days | Fast track process |
| Individual business | 3–7 business days | Immediate VAT number opening |
Do you need a notary?
Yes, always for joint-stock companies, even in the digital incorporation.
How much does it cost to set up an LLC?
On average between 2,600 and 4,400 euros , excluding share capital.
Which is better: an LLC or a sole proprietorship?
It depends on risks, turnover, expected margins, and asset protection. In any case, an analysis of the partners' personal and financial situation is performed.
10. Conclusions
The corporate form chosen affects liability, taxation, contributions, governance, and growth opportunities. A well-structured constitution avoids future errors, shareholder disputes, and unexpected costs.
Studio Genise offers:
- in-depth preliminary analysis;
- consultancy for drafting the statute;
- complete assistance with incorporation;
- operational start-up;
- contribution and tax planning;
- ongoing accounting management.
Thanks to our collaboration with labor consultants and employment lawyers, we also manage the most complex aspects of contributions, employment relationships, INPS (National Social Security Institute), and employment law compliance.
Contact Studio Genise for a personalized consultation and start your business project with maximum confidence and professionalism.