It can be thrilling to launch a business abroad, but it can also bring up a lot of practical issues. Where do you start? What kind of business should you pick? What is the required amount of capital? What about registration, workers, taxes, and visas?
If Italy is on your list, the good news is that there are several routes available to entrepreneurs and foreign investors. Italy is one of Europe’s major economies and has strong industries ranging from manufacturing and automotive to pharmaceuticals, renewable energy, technology, fashion, and design.
In 2026, the country also continues to offer incentives aimed at attracting investment and supporting innovative businesses.
But setting up a company is not simply about choosing an attractive location. You need to understand the legal structure, tax obligations, registration process, and, if you are moving from outside the EU, the immigration requirements.
Here’s a practical look at how to start a business in Italy in 2026.
Why Start a Business in Italy?
Italy offers more than its famous food, fashion and tourism industries.
It is a major European manufacturing economy and has an established presence in sectors such as automotive, pharmaceuticals, renewable energy and technology. Its location also makes it a useful base for businesses looking towards European, African and Middle Eastern markets.
The country has also introduced measures designed to make investment and business formation more accessible, including incentives for innovative start-ups and international investors.
For entrepreneurs, this creates opportunities—but it also means understanding which rules and incentives actually apply to your particular business.
Who Can Start a Business in Italy?
Both EU and non-EU citizens can potentially establish a business in Italy, although the requirements are different.
EU, EEA, and Swiss citizens can conduct business activities in Italy without the same restrictions that apply to many non-EU nationals.
For citizens from outside the EU and EEA, the situation depends on their immigration status and applicable reciprocity rules.
So, before choosing a company structure, it is worth checking whether you have the right to live and work in Italy and what immigration route applies to you.
Choose How You Want to Operate in Italy
Not every foreign business needs to immediately create a full Italian company.
There are several ways to establish a business presence.
1. Representative Office
A representative office is one of the simplest options for a foreign company that wants to explore the Italian market.
It is not a separate legal entity and is generally intended for promotional or preparatory activities rather than direct commercial operations.
It must be registered with the relevant Economic and Administrative Index (REA), but it does not operate in the same way as a fully trading Italian company.
This can make it useful for businesses that want to understand the market before making a larger commitment.
2. Branch of a Foreign Company
A branch, or sede secondaria, allows a foreign company to establish a presence in Italy while remaining connected to its parent company.
Unlike a representative office, a branch is considered a permanent establishment for tax purposes and therefore has Italian tax obligations.
The procedure entails a number of steps, such as internal branch approval, the appointment of an Italian legal representative, the acquisition of a tax code, the preparation of the required notarial papers, and Chamber of Commerce registration.
3. Incorporate an Italian Company
If you desire a separate Italian legal entity, incorporation may be the more appropriate method.
The best option among the several company forms available in Italy will rely on your long-term goals, preferred management structure, number of partners, and level of investment.
Which Italian Company Structure Should You Choose?
There is no single company type that works for every entrepreneur.
S.r.l. — Limited Liability Company
The Società a Responsabilità Limitata, or S.r.l., is one of the most popular structures for foreign investors.
It provides limited liability and offers considerable flexibility in management. According to the source, the minimum capital can be as little as €1, although different capital contribution rules apply depending on the amount invested.
For many small and medium-sized businesses, the S.r.l. can therefore be an attractive structure to consider.
S.p.A. — Joint-Stock Company
The Società per Azioni, or S.p.A., is designed for larger-scale businesses.
It requires a minimum capital of €50,000 and divides capital into shares. It can also be used by companies seeking a structure suitable for larger investments and multiple shareholders.
S.r.l.s. — Simplified Limited Liability Company
The S.r.l.s. was created to encourage entrepreneurship and has capital requirements between €1 and €9,999.99.
Its articles of association are standardised, and only natural persons can be partners. The structure can also have a sole partner.
Partnerships
For certain smaller businesses and partnerships, Italy also offers structures such as the S.n.c. and S.a.s.
Understand Business Taxes in Italy
Taxes are one of the areas you should understand before starting operations.
The Italian system includes corporate, regional, and consumption taxes.
IRES
IRES is the corporate income tax. The source states a standard rate of 24% on taxable profit for companies resident in Italy, including subsidiaries of foreign companies.
IRAP
A regional tax on productive activity is called IRAP. Although the real rate may differ based on the area and industry, the source lists 3.9% as the standard amount.
IVA
IVA is Italy’s value-added tax, equivalent to VAT in many other European countries.
The standard rate listed is 22%, with reduced rates of 10%, 5% and 4% applying to specific categories.
Your actual tax position will depend on the nature of your business, so professional tax advice is important before making financial decisions.
What If You Are a Non-EU Entrepreneur?
Immigration can be just as important as company formation if you are coming from outside the EU.
Italy has specific routes for international investors and entrepreneurs.
Italy Investor Visa
The Investor Visa is aimed at non-EU citizens who make qualifying investments in Italy.
The source lists several routes, including:
- €2 million in Italian government bonds
- €1 million investment in an Italian company
- €500,000 investment in an innovative Italian start-up
- €1 million philanthropic donation in qualifying areas
The investment must be maintained for the required period.
Italy Startup Visa
For non-EU entrepreneurs who want to establish an innovative start-up, the Italy Startup Visa is another possible route.
The source lists a requirement for a viable and innovative business model and minimum financial resources of €50,000. Applications can be made from outside Italy, and the stated processing time is 30 days.
The official Italy Startup Visa portal also confirms that applications are open and that applicants do not need to be physically present in Italy to apply.
Look at Italy’s 2026 Business Incentives
One reason entrepreneurs may consider Italy in 2026 is the range of incentives available to certain businesses.
The source highlights Development Contracts, which can support eligible investments through non-repayable grants and subsidised loans. These can apply to areas such as industry, tourism and environmental projects.
Innovative start-ups may also receive specific benefits, including exemptions from certain registration fees, access to financing support and investor tax incentives.
There are also incentives relating to research, development, innovation and hiring.
The important point is that incentives are generally conditional. Don’t assume that simply registering a company makes you eligible for every programme.
Protect Your Intellectual Property
If your business depends on a brand, invention, design or software, intellectual property should be part of your planning from the beginning.
Italy provides protection for trademarks, patents, designs and software under the relevant legal frameworks.
The source notes that trademarks can be renewed indefinitely in 10-year periods, while patents generally provide 20 years of protection. Designs can receive protection for successive five-year periods up to 25 years.
For a technology- or innovation-focused company, understanding these protections early can prevent expensive problems later.
Conclusion
Starting a business in Italy in 2026 can be an attractive opportunity, but the process becomes much easier when you approach it in the right order.
First, decide what you actually want to build. Then choose the appropriate form of presence and company structure. After that, work through taxation, registration, employment requirements, and, if necessary, immigration.
Italy offers several options for entrepreneurs, from a simple market presence to a fully incorporated company, as well as dedicated routes for investors and innovative start-ups.
The smartest approach is to understand your business model first and then choose the Italian structure, funding route, and immigration option that genuinely fits it.
FAQ
How much money do I need to start a company in Italy?
The amount depends on the type of company you choose. An S.r.l. can have minimum capital as low as €1, while an S.p.A. requires minimum capital of €50,000. Other costs, such as professional, registration, and operational expenses, also need to be considered.
What is an S.r.l. in Italy?
An S.r.l., or Società a Responsabilità Limitata, is an Italian limited liability company. It can have a minimum capital of €1 under the conditions described in the source, and the liability of its partners is generally limited to the capital invested. Its management structure can also be adapted to the company’s needs.
Do I need an Italian bank account to start a company?
An Italian bank account is included in the source’s recommended company-formation checklist, particularly for depositing share capital where required. The exact banking requirements can depend on the company’s structure and circumstances.
Do I need a notary to start a business in Italy?
For incorporation of an Italian company, the process includes consulting an Italian notary and executing the deed of incorporation before a public notary as part of the process.
What are the main steps to start a business in Italy?
The process generally involves choosing a suitable company structure, consulting a notary, obtaining a codice fiscale, arranging the required banking, completing incorporation, registering the company, obtaining a VAT number, completing social security and insurance registrations, obtaining a PEC, and making any required SCIA notification.
Can foreigners buy property in Italy for their business?
Foreigners can purchase real estate in Italy, although the conditions differ. EU and EEA citizens generally face no such restriction, while non-EU citizens are subject to reciprocity requirements. Property transactions must also be formalised through an Italian notary.
