Business immigration to Italy.
The last years for Italy were difficult. Since joining the Eurozone in 2000, the country has repeatedly faced economic problems – first experienced a long-term stagnation, and then was drawn into the world crisis. Last year was marked by long-awaited improvement, but there were unsolved problems: external debts, insufficient GDP growth, unemployment. However, even now, foreign entrepreneurs report that Italians are interested in new ventures and have an atmosphere for doing business.
“Business blossoms. More recently, Italians have watched with grief as talents leave the country and are looking for where the “grass is greener”. Everyone is interested in what I do, for them this is a new hope “, & # 8211; tells about his experience, vice president of consulting company Lansing Economic Area David Olson.
The government is also on its way: Italy is the second country in the EU in terms of the size of tax breaks for medium and small businesses. As a result, 98% of the 4 million companies employ less than 19 people.
Italy occupies the third place in terms of GDP in the Eurozone and the 8th – in terms of nominal GDP in the world. The international rating of Doing Business, in which the business environment in 189 countries of the world is assessed annually, awarded Italy 50th place, and by the share of GDP per capita ranked as “high income”. The country became the absolute leader in the rating by the criterion of “international trade”.
Opening a business in Italy is a chance to enter the pan-European market. But not only membership in the EU is attractive for entrepreneurs, but also the location of Italy in the center and in the south of Europe, which greatly expands the geography of trade. In addition to the neighbors, among the importing countries it is worth noting the United States – in terms of the volume of imported products from Italy, the states are in second place after the European Union.
Branches and regions.
The heterogeneity of the Italian economy can be interpreted in two ways. On the one hand, the country does not rely on one sector and operates in several areas, developing both agriculture and industry, and the service sector. On the other hand, heterogeneity means strong differences between the northern and southern regions – and not in favor of the latter.
Historically, the north of Italy is more developed: in this part of the country there are modern centers of auto, air and sea industry – they form the so-called “Industrial Triangle Milan-Turin-Genoa”. The north-east and central regions rely on small family businesses that produce clothing, footwear, furniture, including luxury products. Usually these firms are not distinguished by innovative technologies, but they win the attention of potential customers by the skill of workers. The South is mostly satisfied with agriculture (63% of all farms are located here) and passive business culture.
For Italy, industrial areas are characteristic – clusters of companies with similar activities located close to each other. In 2015, the Italian banking group Intesa Sanpaolo identified the main industrial regions of the country:
Sebino Bergamasco (north) – rubber, rubber; Chianti (center), Conegliano Valdobbiadene, Verona (northeast) – winemaking; Turin (north), Alba and Cuneo (north) – chocolate; San Mauro Pascoli (north), Naples (south) – shoes; Arezzo, Florence (center) – leather products and shoes; Arzignano (north) – leather industry; Parma (north) – equipment for food industry enterprises; Bologna (north) – packaging equipment; Carrara (center) – marble.
Those who are interested in opening their own business in Italy, experts suggest using the resources that the country is already rich in.
Italy is the fifth most visited country in the world, every year almost as many people visit it as it lives here. Interest for entrepreneurs is not only a restaurant or hotel business, but also less obvious services – for example, taxis in rural areas. You can make a fortune in other already developed areas – winemaking or the production of designer clothes and perfumes. And finally, it is worth paying attention to the peculiarities of the national character: a sports bar or pub has a chance to attract open and sociable Italians.
Opening a business.
In Italy, you can buy a ready-made business, buy out a stake in an Italian company or open a business. The first two options involve a certain risk: in spite of the fact that before buying a company or a part of it auditors check its legal capacity, the acquired business can still unpleasantly surprise. For example, old debts will pop up, the staff will turn out to be bad, and if it comes to dismissal, the new owner of the firm will most likely be forced to pay compensation.
It is much easier to create a company from scratch. Of course, this requires an initial capital, and here it is not worth hoping for loans for business development in Italian banks & # 8211; to foreigners the attitude is not the most trustworthy. Rating Doing Business in early 2017 by the criterion of ease of obtaining a loan puts Italy in 101st place out of 189 positions.
But there are chances to get grants of different levels – from EU subsidies to local incentives: assistance with the purchase of premises and equipment, loans at low interest, and easing the tax burden. True, it is suitable for those who start a business in the countryside or “lifts the southern regions of the country from their knees.” Detailed information can be obtained from the chambers of commerce in Italy.
Individual entrepreneurship, Impresa individuale – is the simplest from the point of view of bureaucracy and a little expensive form of doing business for a single merchant. The entrepreneur gets full freedom of action, can hire employees and enter into contracts with freelancers, while maintaining the dominant position. From an individual entrepreneur you need to register for the payment of VAT and entering the register of the Chamber of Commerce in the place of residence. The only limitation is that one person can establish only one PI. With individual entrepreneurship, you can expect to receive preferential taxation: income tax & # 8211; 5% for 5 years.
If the company is founded by a group of founders, first of all it is important to decide whether the future company, based on the number of employees, potential income and other factors, is a partnership (SNC, SAS) or a society (SPL, SPA).
Full partnership & # 8211; Societa in nome collettivo (SNC) is a popular legal form in Italy. Suitable for beginning entrepreneurs engaged in small business. Among the shortcomings is the unlimited responsibility of the founders in case of problems or bankruptcy of the company and the obligation to repay debts from their own pocket, even if the amount exceeds the amount of initial investment. The company’s profit is considered a personal income of each partner in proportion to its share, respectively, is taxed at a rate of 23 to 43%. Thus, with high incomes, tax rates are also growing, and this form of enterprise may become unprofitable.
A limited partnership, Societa in accomandita semplice (SAS), is characterized by the presence of two categories of founders. Full comrades manage the company and bear unlimited liability. Investors-limited partners do not manage the company and answer only with their monetary contribution. There must be at least two founders of both categories in the SAS. Full comrades are entrepreneurs, their incomes are considered personal and are taxed accordingly; The limited partners can work in the company for hire and receive salaries.
These two forms combine the absence of mandatory seed capital and the inability to know the balance sheet of the company and the incomes of each of the participants.
The authorized capital of the Limited Liability Company, Societa a responsabilita limitata (SRL), may be from one euro. But there are restrictions: for example, a capital of 1 to 9.999 euros is divided into shares, which, however, are not assigned to the founders in the form of certificates and can be assigned to them only after the notarization. Such difficulties can be successfully avoided if the amount of capital is not less than 10,000 euros. The form SRL is suitable for medium and large enterprises with the number of employees from 50 to 250 and annual turnover in the range of 10-50 million euros. For the formation of such a company, one director-citizen of the EU or a foreigner who has a residence permit is necessarily employed. In Italy, LLCs are distinguished by transparent accounting: information about the company’s finances can be requested by anyone – it is enough to apply to the Chamber of Commerce.
The form SRL is suitable for companies whose owners own real estate in Italy and do not want to subject their property to commercial risks.
License for activities.
Certain activities in Italy are not regulated by the state, that is, they do not require confirmation of qualifications. These include the profession in the field of marketing and advertising, oral and written translation and art – design, music, painting and others.
The EU Single Market database, enriched by the EU member states and the European Economic Area, contains information on 176 professions regulated by the Italian government. The full list can be found here. In addition, entrepreneurs from outside the EU must necessarily obtain a license to conduct business. The best advisers in this matter are the local chambers of commerce and the city administration.
As a rule, companies registered on the territory of Italy are subject to income tax (IRES) of 27.5%, while tax deductions are made both from profits received in the territory of the country, and beyond. And on the contrary, companies registered abroad pay taxes only with what they earned in Italy.
IRAP, the regional tax on production activities, is 3.9%, however each region has the right to raise or lower the tax rate within the range of 0.92%. According to statistics, companies, whose owners are foreign citizens, on average deduct IRAP at a rate of 3,6%. The property tax of the company (IMA) is between 0.4 and 1.06% of the value of the property, depending on the region.
The standard VAT is 22%. Reduced VAT is assigned to certain categories of goods and services:
4% & # 8211; some electronic and paper books and publications, medical equipment for people with disabilities, agricultural machinery, some products and others; 5% & # 8211; some social and medical services; 10% & # 8211; some types of food raw materials, pharmaceutical products, repair of private residential premises, collection of household waste, processing of liquid waste, alcoholic beverages in catering establishments and others.
Most firms in Italy, especially foreign ones, hire a tax consultant (commercialista) – its services cost about 6,000 euros per year.
Visas and relocation.
To arrive in the country for the purpose of doing business in Italy, entrepreneurs receive a national visa of category D, which they receive at the Italian consulate. Upon arrival in Italy, a foreign citizen submits a request for a temporary residence permit to the local Questura – motivation for obtaining will be business management (Permesso per motivo lavoro autonomo). The validity of the residence permit is identical to the period specified in the received “D” visa.
Five years of legal residence in Italy on a temporary residence permit – and a foreigner can change it to permanent. With a permit for a long stay, residents receive virtually the same rights as local residents. Unlike many countries, the Italian government does not check whether the entrepreneur creates jobs and how successful his business is. To “gain a foothold”, it is sufficient to know the language well, not to have problems with the law and to pay taxes in time.
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