Self-Employment in Italy
An introduction to setting up to trade as a freelancer, self-employed person or sole trader in Italy...
An EU national or a permanent resident with a certificato di residenza, may become self-employed (lavoro autonomo or lavoro in proprio), work freelance (lavoro indipendente or libero professionista) or operate as a sole trader (commerciante in proprio, imprenditore or ditta individuale) in Italy.
A Permesso di Soggiorno (permit to stay) does not automatically allow self-employment and it needs to be changed to a Permesso di soggiorno per lavoro autonomo/indipendente (how easy this may be done depends on nationality and status). Certain legal requirements must be met and registration with the appropriate organisations is essential to be self-employed in a profession or start a freelance business in Italy. For example:
- be included on the Register of Enterprises (Registro delle Imprese) maintained by the local chamber of commerce (camera di commercio)
- obtain a certificate of registration (certificato di iscrizione)
- register with the local tax office (intendenza di finanza)
- be registered for VAT (Imposta sul Valore Aggiunto, IVA)
Under Italian law, a self-employed person must have an official status and it’s illegal to simply hang up a sign and start trading. Members of some professions and trades must have certain qualifications and certificates recognised in Italy. Do not start work before registration; doing so may incure stiff penalties, which may include a large fine, confiscation of machinery or tools, deportation and even a ban from entering Italy for a number of years.
A sole trader must register with the local tax office and is taxed in the same way as any other individual. Note, however, that the liabilities of a sole trader aren’t deemed to be separate from his personal debts and should they become insolvent they would be declared bankrupt. Therefore it may be advantageous to operate as a limited company, for example a Società a Responsabilità Limitata (Srl) or Società Per Azioni (SpA). Always obtain professional advice before deciding whether to operate as a sole trader or form a company, as it has far-reaching social security, tax and other consequences.
Self-employed people may wish to join the Unione di Commercio, which provides a range of information and assistance for the self-employed and those running their own businesses, including supplementary health insurance and help in dealing with Italian bureaucracy, taxation and social security. These are local organisations.
Bear in mind that self-employed enjoy far fewer social security benefits than employees.