How to Set Up a Company in Italy (2026): SRL, Spa or Branch, a Guide for Foreign Founders

Set up company Italy searches have risen sharply as foreign founders, venture investors and corporate acquirers look to establish an Italian presence in 2026. Italy offers a stable EU legal framework, access to the single market and a mature corporate law system rooted in the Codice Civile, but the choice between a limited liability company (SRL), a joint-stock company (SpA) or a branch office has real consequences for liability, capital, governance and tax. This guide is written for non-resident founders and in-house counsel who need a practical, decision-focused overview of the Italian corporate forms, the registration process, likely timelines and costs, and the investor protections that matter when raising or deploying capital.

It draws on primary legal sources so that each requirement can be verified against authoritative Italian and EU references.

Introduction, why choosing the right Italian vehicle matters

The vehicle you select at the outset shapes almost everything that follows: how investors subscribe capital, whether shares are freely transferable, what governance bodies you must maintain, how profits are taxed and how much ongoing compliance the business will carry. Getting it wrong is expensive to reverse, converting from one form to another, or restructuring a branch into a subsidiary, typically requires notarial deeds, new filings and tax analysis. For most foreign founders the practical choice narrows to three options: an SRL, an SpA, or a branch of an existing overseas company. Each is governed by the Italian Civil Code (Normattiva) and registered through the Registro delle Imprese. The sections below explain how they differ and how to decide.

Quick summary: SRL vs SpA vs branch

Before the detail, here is the short version. An SRL (Società a responsabilità limitata) is the Italian equivalent of a limited liability company and is by far the most common choice for startups, subsidiaries and closely held businesses. An SpA (Società per Azioni) is a joint-stock company designed for larger enterprises, capital markets access and complex investor structures. A branch (sede secondaria) is not a separate legal entity but an extension of a foreign parent, useful for a light presence but carrying different liability and tax consequences.

Verify all numeric thresholds and statutory minima against Normattiva and the Gazzetta Ufficiale, as capital rules and subtype variants can change.

When to prefer each option

• Choose an SRL when you want limited liability with lean governance, a single or small group of shareholders, and flexibility to bring in early-stage investors. This is the default vehicle for most founders who set up company Italy operations from abroad.
• Choose an SpA when you anticipate large capital raises, multiple share classes, a potential listing, or a governance structure that institutional investors and corporate partners expect.
• Choose a branch when the foreign parent wants a direct operational foothold without incorporating a subsidiary, accepting that the parent remains legally and, potentially, fiscally exposed.

Legal forms explained: SRL, SpA, branch and others

Italian company law is codified principally in Book V of the Civil Code (Normattiva), supplemented by guidance from the relevant Italian ministry responsible for enterprise and industrial policy (currently the Ministry of Enterprises and Made in Italy, Ministero delle Imprese e del Made in Italy). Understanding the legal character of each form is essential before you commit to registration.

What is an SRL (Società a responsabilità limitata)?

The SRL is the closest Italian analogue to a limited liability company or LLC. Its capital is divided into quotas (quote) rather than shares, and each quotaholder’s liability is limited to the amount they have subscribed. The SRL is prized for its flexible governance: the shareholders’ meeting and one or more directors can run the company, and many operational rules can be tailored in the articles of association. For foreign founders, the SRL usually offers the best balance of liability protection, lower formation cost and adaptability. Italian law also recognises a simplified variant of the SRL (SRL semplificata) aimed at reducing start-up costs, so confirm which subtype fits your situation and verify the applicable capital rules against the Codice Civile.

Because quotas are not freely tradable in the way listed shares are, transfer restrictions and investor rights should be set out carefully in the articles and any shareholders’ agreement.

What is an SpA (Società per Azioni)?

The SpA is a joint-stock company whose capital is represented by shares (azioni). It is the vehicle of choice for large enterprises, companies seeking access to capital markets, and structures where multiple classes of shares, complex investor rights and formal board governance are required. The SpA carries a higher minimum share capital and stricter organisational requirements than the SRL, including mandatory corporate bodies and, in many cases, statutory auditors (collegio sindacale). Shares in an SpA are, in principle, freely transferable, which makes the form attractive for later-stage financings, secondary sales and eventual listing. The trade-off is greater formation complexity, higher ongoing compliance and more expensive administration.

Foreign investors planning significant capital deployment or an eventual exit through public markets frequently prefer the SpA precisely for its transferability and governance formality. All capital and governance thresholds should be checked against Normattiva and the Gazzetta Ufficiale.

Branch or permanent establishment vs subsidiary

A branch (sede secondaria) is a registered extension of a foreign company rather than a distinct Italian legal person. Establishing a branch requires registering the foreign entity’s details with the Registro delle Imprese, appointing a representative in Italy, and complying with Italian accounting and tax rules for the branch’s activities. The critical distinction is liability and tax: because the branch is legally part of the parent, the parent bears responsibility for the branch’s obligations, and the branch typically constitutes a permanent establishment for Italian corporate tax purposes.

That means the profits attributable to the branch are generally taxable in Italy, and the parent must manage transfer pricing and attribution issues (see guidance from the Agenzia delle Entrate and comparative material from the OECD). A subsidiary, an SRL or SpA, ring-fences liability within the Italian entity and provides a cleaner platform for local investment, hiring and future fundraising.

Other forms: sole trader, partnerships and the SE

Beyond the three primary vehicles, Italy recognises sole traders (ditta individuale/impresa individuale), various partnership forms and the European Company (Societas Europaea, or SE). Sole trader status offers simplicity but no liability separation and is rarely suitable for foreign founders raising capital. Partnerships expose partners to differing degrees of personal liability and are uncommon for international ventures. The SE is a pan-European corporate form that can be useful for groups operating across several member states, but it involves substantial capital and procedural requirements. For the overwhelming majority of founders who set up company Italy structures for growth or investment, the SRL and SpA remain the practical options.

Choosing the right form for foreign founders and investors

The decision should be driven by commercial objectives rather than habit. Below are the priorities that most influence the choice, followed by a practical checklist.

Investor priorities: liability, capital, transferability, governance and funding

Investors evaluate an Italian vehicle against several criteria. Limited liability is a baseline expectation, met by both the SRL and SpA. Capital requirements differ, with the SpA demanding a higher statutory minimum. Transferability matters enormously for exits: SpA shares are more readily transferable, while SRL quotas are typically subject to pre-emption and articles-based restrictions. Governance formality, board composition, statutory audit, reporting, is heavier in the SpA and lighter in the SRL. For early-stage funding, an SRL with well-drafted articles and a shareholders’ agreement is often sufficient; for institutional rounds or a listing pathway, the SpA is usually preferred.

Residency and director requirements for non-residents

A frequent question from those who set up company Italy operations remotely is whether directors must be Italian residents. Italian company law does not, as a general matter, require directors to reside in Italy, and foreign nationals can generally serve as directors and shareholders, subject to any applicable reciprocity and immigration rules for non-EU nationals. In practice, every director and shareholder will need an Italian tax code (codice fiscale) issued by the Agenzia delle Entrate, and foreign documents may require legalisation or an apostille before use. Directors’ duties and liabilities under the Civil Code apply regardless of nationality, so non-resident directors should understand their obligations. Confirm any specific requirements against the Codice Civile on Normattiva and current official guidance.

Financing and venture capital considerations

Where venture capital is in prospect, the corporate form must accommodate investor rights. The SRL can support differentiated quota classes and tailored economic and voting arrangements, making it viable for seed and early rounds; Italian law also provides certain additional flexibilities for SRLs qualifying as innovative startups. As financings grow in size and complexity, preferred rights, liquidation preferences, anti-dilution mechanics, formal board seats, many investors prefer the certainty and transferability of an SpA. Founders should model their likely fundraising trajectory before choosing, because migrating from SRL to SpA later is possible but adds cost and delay.

A practical decision checklist:

• Will you raise institutional capital or seek a listing? If yes, lean towards SpA.
• Do you need lean governance and lower cost now? If yes, an SRL is likely appropriate.
• Do you want to ring-fence Italian liability from the parent? Choose a subsidiary over a branch.
• Is the Italian activity likely to create a taxable presence? Factor in permanent establishment analysis.
• How important is free transferability of equity for future exits? Higher importance favours SpA.

Step-by-step: how to set up a company in Italy and register it

The registration process is well defined and increasingly digital, but foreign founders should plan for document legalisation and notarial steps that can affect timing. The following numbered process describes a typical incorporation of an SRL or SpA; branch registration follows an analogous but distinct path. Timelines are indicative, verify current processing times with the relevant authorities.

1. Pre-formation checklist. Choose and verify the company name, define the corporate purpose, identify shareholders and directors, and prepare the draft articles of association. Obtain an Italian tax code (codice fiscale) for each foreign shareholder and director from the Agenzia delle Entrate.
2. Notarisation and deed of incorporation. Italian incorporation requires a public deed executed before an Italian notary. Foreign founders who cannot attend in person typically act through a power of attorney, which must itself be legalised or apostilled and, where needed, translated. The notary verifies identity, capital arrangements and the legality of the articles.
3. Registration with the Registro delle Imprese. The notary or an authorised intermediary files the deed and articles with the Registro delle Imprese at the competent Chamber of Commerce, generally through the online filing system. Registration confers the company’s legal existence and publicity of its key data.
4. VAT and tax identification. The company obtains its VAT number (partita IVA) and confirms its tax registration with the Agenzia delle Entrate. This is essential before invoicing or trading.
5. Social security and employer registrations. If the company will employ staff, register as an employer with INPS and address related insurance obligations (including with INAIL) before onboarding employees.
6. Bank account and capital payment. Open an Italian corporate bank account and arrange payment of the required portion of share capital in accordance with the chosen form. Banks apply know-your-customer and anti-money-laundering checks, which can require additional documentation from foreign beneficial owners.
7. Timeline and typical delays. Where documents are in order and powers of attorney are pre-prepared, incorporation and registration can proceed within a matter of weeks. The most common causes of delay are legalisation of foreign documents, obtaining tax codes for non-residents, and bank onboarding. Treat any timeline as typical rather than guaranteed, and confirm current processing with the notary and Chamber of Commerce.

Founders who set up company Italy vehicles from abroad should front-load the document and legalisation work, because that is where most avoidable delay arises. Coordinating the notary, the bank and the tax registrations in parallel rather than in sequence shortens the overall timeline.

Costs, timelines and typical professional fees

Total cost depends on the form chosen, the complexity of the articles, the amount of capital and whether translation and legalisation are needed. Broadly, the cost categories are the same for every foreign founder who chooses to set up company Italy structures.

• State and registration fees. Government and Chamber of Commerce fees for filing with the Registro delle Imprese, plus applicable stamp duties and the annual Chamber of Commerce charge. Confirm current banding with the Chamber of Commerce.
• Notary fees. The notarial deed of incorporation is a mandatory cost and varies with the complexity and capital of the company; an SpA generally attracts higher notarial fees than an SRL.
• Translation and legalisation. Foreign documents, powers of attorney, corporate resolutions of a parent company, identity documents, may require certified translation and apostille or consular legalisation.
• Legal and advisory fees. Fees for drafting articles, shareholders’ agreements and structuring advice. Lawyers may charge hourly or on a fixed-fee basis for a defined incorporation scope.

Example fee scenarios for foreign founders

A straightforward SRL incorporation with standard articles sits at the lower end of the cost range, driven mainly by notary and state fees plus a modest legal fee. An SpA, with its higher capital, additional corporate bodies and more elaborate governance, sits at the higher end. A branch registration falls in between, but the ongoing tax and accounting burden of a permanent establishment can make the branch more expensive over time than a lean subsidiary. Because fee levels vary by region, notary and complexity, treat these as illustrative and obtain written quotes before proceeding.

On the recurring question of how much a lawyer is paid in Italy to incorporate a company, the honest answer is that it depends on scope and billing model; a defined fixed fee is common for standard formations, while bespoke investor structuring is usually billed by time.

Governance and investor protections

Good governance drafting at incorporation prevents disputes later and is central to any investor’s diligence. The articles of association and, separately, a shareholders’ agreement are the two instruments that carry most of the weight.

Articles of association and governance clauses

The articles establish the company’s constitution: corporate purpose, capital and quota or share structure, the powers and composition of management, meeting procedures and decision thresholds. For an SRL, the articles can allocate governance flexibly, which is an advantage but also means important protections must be actively drafted in. For an SpA, the Civil Code imposes a more prescriptive framework of corporate bodies. In both cases, align the articles with the intended investor arrangements from the outset.

Shareholders’ agreements and investor rights

A shareholders’ agreement typically addresses the matters investors care about most: pre-emption rights on new issues and transfers, drag-along and tag-along rights, reserved matters requiring investor consent, information rights, and restrictions on the transfer of equity. In an SRL, where quota transfers can be restricted, these mechanisms are essential to give investors comfort. Note that under Italian law shareholders’ agreements (patti parasociali) may be subject to duration limits, so their term should be structured with that in mind. Founders should treat the shareholders’ agreement as a core investment document rather than an afterthought.

Board structures and minority protections

Board composition, quorum and voting rules, and minority protections such as reserved matters and veto rights all belong in the governance package. Minority investors will expect protections proportionate to their stake and risk. Clear rules on deadlock, director appointment and removal, and the consequences of default reduce the risk of costly disputes. These provisions should be tailored to the chosen corporate form and to the specific investor base.

Post-formation compliance and next steps

Incorporation is the beginning, not the end, of the compliance obligations that attach when you set up company Italy operations. Ongoing duties include maintaining statutory accounting records, preparing and filing annual financial statements, filing corporate tax returns with the Agenzia delle Entrate, and meeting VAT obligations. Companies must also register beneficial ownership information as required under applicable anti-money-laundering rules. Employers must operate payroll and remit social security contributions through INPS. Groups with cross-border transactions must consider transfer pricing and intra-group documentation.

When a branch creates tax residency or a permanent establishment

Where a foreign company operates through a branch, the branch will generally constitute a permanent establishment, and the profits attributable to it are taxable in Italy. The attribution of profits, the deductibility of costs and the interaction with any applicable double tax treaty require careful analysis with reference to the Agenzia delle Entrate and comparative OECD guidance. Founders weighing a branch against a subsidiary should model the tax and compliance consequences before deciding, because the two routes diverge significantly once operations scale.

Comparison table: SRL vs SpA vs branch

Statutory minima and mandatory bodies must be confirmed against Normattiva, the Gazzetta Ufficiale and the Registro delle Imprese. Subtypes such as the simplified SRL may vary.

Conclusion and next steps

To set up company Italy operations successfully, foreign founders and investors should start from commercial objectives, liability, capital, transferability, governance and tax, and let those drive the choice between an SRL, an SpA and a branch. For most, a well-structured SRL delivers limited liability with lean governance; an SpA suits larger, investor-heavy or listing-bound ventures; and a branch fits only a light, parent-dependent presence. Whichever route you choose, front-load the document, legalisation and tax-code work, coordinate the notary, bank and registrations in parallel, and get the articles and shareholders’ agreement right at the outset.

For tailored, binding advice on your specific structure, consult qualified Italian counsel through the Business practice area at Global Law Experts and explore the supporting guides on registering an SRL, formation costs, and tax and employment considerations.

Sources

1. Normattiva, Italian legal database (Codice Civile)
2. Gazzetta Ufficiale della Repubblica Italiana
3. Registro delle Imprese (InfoCamere)
4. Ministero delle Imprese e del Made in Italy (MIMIT)
5. Agenzia delle Entrate (Italian Revenue Agency)
6. INPS (Italian social security institute)
7. Consiglio Nazionale Forense (Italian National Bar Council)
8. OECD