Company Formation & Entity Setup in Italy

SRL and SpA incorporation, notarial deed, Chamber of Commerce registration, and post-formation compliance setup.

Italy Reviewed September 2026

Currency

EUR

Legal forms

SRL · SpA

Minimum share capital

SRL: €10,000 standard (€1 possible with reserve obligations) · SpA: €50,000

Registration body

Chamber of Commerce (Registro delle Imprese), via notarial deed

Formation timeline

1–3 weeks for an SRL with standard bylaws

Corporate tax rate

24% IRES + 3.9% IRAP (combined ~27.9%, IRAP variable ±0.92pp by region)

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How company formation works in Italy

Italy applies a national corporate income tax (IRES) alongside a regional production tax (IRAP), with the latter varying by up to 0.92 percentage points depending on the region — a structural layer most foreign companies do not encounter in comparable EU markets. Incorporation is comparatively fast and flexible: an SRL can in principle be formed with €1 in capital, though going below €10,000 carries mandatory profit-reserve obligations that make the standard threshold the practical default for most operating subsidiaries.

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Matched to your business objective

SRL

Liability

Limited to company assets

Min. capital

SRL: €10,000 standard (€1 possible with reserve obligations) · SpA: €50,000

The standard vehicle for an operating subsidiary of a foreign company — the default choice for most market-entry engagements in Italy.

SpA

Liability

Limited to company assets

Min. capital

SRL: €10,000 standard (€1 possible with reserve obligations) · SpA: €50,000

Used for larger operations, more formal governance needs, or entities seeking to raise capital publicly.

Branch

Liability

None separate — the foreign parent company bears full liability

Min. capital

None — no separate capital requirement

Useful for testing the Italy market before committing to a subsidiary, or for keeping a single legal entity across borders. Creates a taxable presence — profits are generally taxed in Italy.

Representative office

Liability

N/A — not a registered legal entity in most cases

Min. capital

None

For market research and liaison activity only — cannot sign contracts, invoice, or trade locally in most jurisdictions.

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What it takes to register, and how long

Formation runs through the Chamber of Commerce (Registro delle Imprese), via notarial deed, typically taking 1–3 weeks for an SRL with standard bylaws.

IRAP regional variation — of up to 0.92 percentage points, requiring tax base allocation across regions for multi-location companies
TFR accrual and annual revaluation — a deferred liability requiring continuous calculation (1.5% fixed + 75% of ISTAT inflation) for every employee
CCNL classification — sector-specific collective agreement minimums for salary, notice and severance that frequently exceed statutory floors
13th and 14th month salary — built into gross remuneration and factored into TFR calculation

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Frequently asked questions

What is TFR and why does it matter for budgeting?

TFR (Trattamento di Fine Rapporto) is a deferred severance payment that accrues for every employee throughout employment, calculated as annual gross salary divided by 13.5, plus an annual revaluation of 1.5% fixed plus 75% of ISTAT inflation. It is owed in full on any termination — resignation, dismissal, or retirement — and should be modelled from the first month of employment, not estimated at year-end.

What is the difference between an SRL and an SpA?

An SRL has a standard minimum capital of €10,000 (a reduced-capital version from €1 is possible but carries mandatory profit-reserve obligations) and suits most operating subsidiaries. An SpA requires €50,000 and a more formal governance structure, typically used for larger or capital-market-facing entities.

How does IRAP work alongside IRES?

IRES is Italy's national corporate income tax at 24%. IRAP is a separate regional production tax, standard rate 3.9%, which regions can adjust by up to 0.92 percentage points. Companies operating across multiple regions must allocate their IRAP taxable base accordingly, generally based on personnel costs by location.

How does the EU Blue Card salary threshold work in Italy?

The threshold is indexed to 1.5 times the national average gross salary published by ISTAT, with a reduced threshold of 1.2 times for shortage occupations such as IT, healthcare and engineering. The exact figure is revised periodically; current guidance should always be confirmed before an offer is finalised.

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TFR is frequently underestimated by companies modelling Italian employment cost from base salary alone. As a continuously accruing liability with its own revaluation mechanism, it requires year-round tracking, not a year-end estimate.

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