Legal grounds and rules for opening an innovative startup in Italy
On 19 December 2012, with Law No. 221/2012, the government adopted legislation for the development and growth of the country. In particular, Section IX is devoted to a new type of business: the innovative startup!
A limited liability company (SRL) based in Italy or another EU Member State, provided that it has a production site or branch in Italy and meets certain requirements.
A startup should contribute to sustainable growth, technological development and employment, especially among young people, the development of a new entrepreneurial culture, the creation of an environment more favorable to innovation, greater social mobility, and attract talent, innovative companies, and capital from abroad to Italy.
Innovative startups are entitled to a wide range of benefits, including:
- Bureaucratic and tax benefits for all operations related to the business register;
- Flexible labor regulation;
- Employee share incentive plans;
- Equity crowdfunding;
- Easier access to bank credit;
- Tax incentives for investments;
1. Reduction of incorporation fees: unlike other companies, a startup is exempt from stamp duty and administrative fees for entries in the Companies Register, and from paying the annual Chamber of Commerce fee.
2. Flexible labor regime: a startup may hire employees under fixed-term contracts lasting between 6 and 36 months. During this period, contracts may be renewed several times. After 36 months, the contract can be extended only once for a maximum of 12 additional months, thus up to 48 months in total. Afterwards, the collaborator may continue only under an open-ended (permanent) employment relationship.
3. Incentive plans: a startup may reward its employees with "stock options", and external service providers such as lawyers or accountants with “work-for-equity” schemes. For recipients, such rewards are exempt from taxation and contributions.
4. Tax incentives for investments in startups: individuals receive a 19% IRPEF deduction, and legal entities a 20% IRES deduction. The incentive applies to both direct investments in startups and indirect ones through companies that mainly invest in startups. The rate is higher for startups with a social vocation or those operating in the energy sector (up to 25% and 27% respectively).
5. Introduction of equity crowdfunding, allowing startups to raise capital through online platforms authorized by Consob (Resolution No. 18592).
6. Simplified, free and direct access for startups to the Central Guarantee Fund (Fondo Centrale di Garanzia), a public fund that facilitates access to credit by providing guarantees for bank loans. The guarantee covers up to 80% of the loan amount, up to € 2.5 million, under simplified admission criteria with priority processing.
7. Special support in the process of internationalization through the ICE Agency. This includes assistance with legal, corporate, tax, real estate, contract, and credit issues, free participation in major international fairs and events, and programs connecting innovative startups with potential early-stage and expansion-stage investors.
For more information, see the Ministry of Economic Development’s summary of policies supporting startups.
The company may be newly established or not older than 60 months to apply for registration as an innovative startup.
The company must be tax resident and have its registered office in Italy.
From the second year onwards, the company’s annual turnover must not exceed €5,000,000.
The company must not have distributed or currently distribute profits to shareholders.
The company’s exclusive or main corporate purpose must be the development, production and marketing of innovative products or services with high technological value.
It must not have been formed as a result of a merger, corporate split, or purchase of a company or business unit.
Expenditure on research and development equals or exceeds 15% of either the higher of production cost or total value of production. Real estate purchase and lease costs are excluded. In addition to accounting standards, R&D expenses include pre-competitive and competitive development, prototypes, business-plan preparation, incubator services, staff and consultants directly engaged in R&D, legal costs for IP registration, and software licenses. These must be detailed in the most recent approved balance sheet or, for the first year, declared by the legal representative.
Employment of workers or collaborators in a proportion equal to or greater than one-third of the total workforce who hold a PhD degree or are pursuing one at an Italian or foreign university, or who hold a degree and have carried out certified research for at least three years in public or private research institutes in Italy or abroad; or, in a proportion equal to or greater than two-thirds of the total workforce, employees with a master’s degree under Art. 3 of the Ministerial Decree of 22 October 2004 No. 270.
The company owns, holds, or is licensed to use at least one industrial property right relating to an industrial or biotechnological invention, semiconductor topography, or new plant variety, or holds rights to an original software program registered in the public software register, provided such IP rights are directly related to the company’s purpose and business activity.
The first step is to verify the requirements. A team of professionals will assess your strategy and propose a solution to ensure compliance (if possible).
Prepare documents, plans, presentations, and registration forms for submission to the Business Register. These materials are required for the inter-ministerial committee.
Establish a company as an SRL (Limited Liability Company), Simplified SRL (SRLs), or similar, and declare the start of activity.
Incorporation requires a notary’s involvement. The notary who drafts the incorporation act must submit it to the Companies Register.
Apply for registration in the special section of the Business Register for Innovative Startups. After this, your company will obtain the StartUp Innovativa status in Italy and gain access to all the benefits associated with it.
You need a contract with a company that will handle accounting. This is standard practice in Italy.
The remaining formalities can be handled by the company’s legal representative, a professional consultant, a trade association, or another authorized intermediary.
Permesso.me provides services for document preparation, company incorporation, and notary support.
To register a company, you need an office address. It can coincide with your rented or owned premises.
To launch a Startup (StartUp Innovativa), you will need:
This amount includes:
An assessment of your enterprise and strategy preparation to define the Startup direction. The basis is a selection of the Decree under which your activity may comply with EU requirements.
Preparation of documentation for submission to the Startup Register. It is necessary to prepare a presentation, business plan, description, and other materials that will give the Commission a clear picture of the Startup.
You will need an office, a contract with an accountant, and other operational elements depending on your setup — either a representative office or a full-scale production site.
To register the company in the special section for innovative startups, a specific online application must be submitted electronically through the "ComUnica" unified business registration system.
This declaration must be periodically updated and submitted to the Companies Register within 30 days after the approval of the financial statements, and in any case within six months after the end of each fiscal year, to confirm that all legal requirements remain fulfilled.
The application for registration in the special section is made by providing the following information in the new "STARTUPS AND INCUBATORS" field of the standard Companies Register form.
The information entered in the table next to the company’s current obligations must be transmitted to the Companies Register following the prescribed procedures.
Note: in case of any change in the information above, it must be updated at least every six months.
To open a Startup (StartUp Innovativa), you will need:
This amount includes:
The Startup Visa program allows foreign citizens from outside the EU to obtain a residence permit in Italy by opening an innovative startup and proving sufficient funding for its development.
To apply for a Startup Visa, you must demonstrate financial resources of at least €50,000 available for investment in your innovative startup. These funds can be placed on an Italian bank account linked to your company.
The application for a Startup Visa is submitted online to the Interministerial Committee for the Attraction of Foreign Investments. It must include the business plan, CVs of founders, and a letter of commitment to invest €50,000.
After approval, you receive an official *Nulla Osta* (authorization) to apply for a visa at the Italian Consulate in your country of residence.
After receiving *Nulla Osta*, you can apply for a Startup Visa at the Italian consulate. Once issued, it allows you to enter Italy and apply for a residence permit (*Permesso di Soggiorno per Startup*).
Upon arrival in Italy, you must apply for a residence permit within 8 days, open a bank account, and complete company incorporation (if not already done). The Startup Visa provides a 1-year permit, renewable if the startup remains active.
You can access support from Invitalia — Smart&Start Italia program. It offers funding for innovative startups up to €1.5 million, partially non-repayable and interest-free.
The Startup Visa is a simplified immigration procedure for entrepreneurs who wish to develop innovative business projects in Italy. It allows you to reside, work, and scale your business, contributing to the Italian innovation ecosystem.