When deciding to establish a company in Italy or in any other country, expenses must first be calculated in order to determine the cost of doing business.
The main taxes for doing business in Italy are:
- IRES – income tax for corporate income, levied on the income that results from the difference between taxable revenues and the deductible costs borne in carrying on business activities
- IRAP – Regional tax on productive activities levied on the net value of production
- VAT (Value Added Tax), applied on the value added to goods and services with rates between 4% and 22%
- IRPEF – income tax for personal income that is calculated by applying increasing rates by income increments to the net overall income.
The values of these taxes may vary from time to time and depending on the type of firm, business and industry. If you require assistance with information related to taxes, you can call our specialists and benefit from their expert local knowledge.
Running a business in Italy may involve paying other types of taxes such as municipal tax (IMU) charged on the possession of buildings, buildable areas and agricultural lands, registration tax for registering different kinds of documents such as contracts, land registry tax which is paid after land transactions, stamp and excise duties, tax on advertising and on the occupation of public spaces.
Italian companies must also arrange a VAT number, bookkeeping and draw up an annual Financial Statement according to the scheme provided by the Italian Civil Code or Bank of Italy and in Italian GAAP or IFRS case dependant. Annual Financial Statements are approved by the Annual General Meeting within 120 days of the fiscal year-end.
Depending on the type of entity and/or business activity of the Italian company, the following must be prepared and submitted to the relevant authorities:
- Annual statutory financial statements
- Annual CIT (corporate income tax) return
- Annual IRAP return
- Annual VAT return
We provide a wide range of accounting and tax services including monthly or annual financial reports.
Contact our offices in Milan or Rome to find out more about how we can help you reduce the burden of your business growth.