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Published: 04 Nov 2008 07:14:17 PST

Italy

Business Environment

Business practices

For further information: Doing Business in Italy
For further information: Italian culture and customs
Closed hours and days: Saturday and Sunday closed, or only Sunday and Monday morning for trade.

Public holidays

New Year's Day	1 January
Epiphany	6 January
Easter Sunday and Monday	First Sunday after the first full moon of spring
Liberation Day (National holiday)	25 April
Workers' day	1 May
Assumption	15 August
All Saints	1 November
Immaculate Conception	8 December
Christmas and St Stephen's Day	25 and 26 December
Summer holidays	Second and third week of August

Compensation day: When a public holiday falls on a Sunday, some shops are closed the Monday after.

Periods when companies usually close

Standards

National standards organizations: Italian Standardization Organization (Ente Nazionale Italiano di Unificazione, UNI)
Italian Electrotechnical Committee (CEI)
Integration in the international standards network: International Organization for Standardization (ISO)
International Electrotechnical Commission (IEC)
International Telecommunications Union (ITU)
European Committee for Standardization (CEN)
European Committee for Electrotechnical Standardization (CENELEC)
Classification of standards: Italian standards are called UNI. Those of the electrotechnical sector are called CEI.
Online consultation of standards: The UNI catalog
The CEI catalog
The ISO catalog
Certification organizations: Italian accreditation federation (SINCERT-FIDEA)
Association of independent test and certification laboratories (ALPI)
National system for laboratory accreditation (SINAL)
Calibration Service (SIT)

Legal framework

Independence of justice: Yes
Equal treatment of nationals and foreigners: In the legal texts, there is no discrimination against foreigners. In practice, however, there is some discrimination.
The language of justice: Italian
Having recourse to an interpreter
Sources of the law and legal similarities: The Italian Civil Code was created on the basis of Roman law modified by the Napoleonic Code. It is also modelled on German law. The highest law is the Constitution.
Consulting national laws online: The constitution in 5 languages
Codes in Italian

Intellectual Property

National organizations: Italian Bureau for Patents and Trademarks (the official agency for the protection of intellectual property in Italy).
Copyright SIAE (Società Italiana degli Autori ed Editori : Italian Society for Authors and Editors).
Regional organizations: For the protection of patents: the European Patent Office
Governing trademarks, designs and models: the Office for Harmonization in the Internal Market
International membership: Member of the WIPO
Signatory to the Paris Convention
Membership to TRIPS

National regulation and international agreements

Type of property	Law	Validity	International agreements signed
Patent	1939 law on patents	period of validity: 20 years	Patent Cooperation Treaty Strasbourg agreement concerning the International Patent Classification
Trademark	1939 law on models	period of validity: 10 years	Trademark law treaty Nice agreement concerning the International classification of goods and Services for the Purposes of the registration of Marks Protocol relating to the Madrid Agreement concerning the International Registration of Marks
Design	Law on designs	initial period of validity: 15 years
Copyright	2000 copyright law		Berne convention for the protection of Literary and Artistic Works Convention for the Protection of Producers of Phonograms against unauthorized duplication of their phonograms Rome convention for the protection of performers, producers of phonograms and Broadcasting organizations WIPO copyright treaty WIPO performances and Phonograms treaty
Industrial Models	1939 law on industrial designs	initial period of validity: 15 years

Tax rates

Consumption taxes

Nature of the tax: IVA
Tax rate: 20%
Reduced tax rate: A rate of 10% is applied to some foodstuffs, live animals, some fuel supplies, catering, transport and housing.
A rate of 4.5% is applied to some foodstuffs, imports of agricultural products, medical supplies, books and magazines.
Other consumption taxes: Other taxes are determined at the national or local level such as taxes on tobacco, petrol, alcohol, oil, etc.

Corporate taxes

Tax rate

IRPEF	:	33%. A different calculation has to be made for banks, insurance companies and other financial intermediaries, in accordance with the interests of IRES and IRAP.
IRAP	:	4.25%.

Tax rate for foreign companies

Resident companies are taxed on the basis of their global revenue. Non-resident companies are taxed on the basis of their income earned in Italy.

Capital gains taxation

Capital gains are generally treated like ordinary revenue and are taxed at a rate of 33% of the company's income tax.

Main allowable deductions and tax credit

Research expenses. Royalties on intellectual property such as patents and trademarks. Expenses for advertising and entertainments.

Other corporate taxes

The Municipal Tax is levied on real estate property.

Individual taxes

Tax rate

Individual tax

5 tax brackets, (including 3 new rates: 27%, 38% and 41%) with a maximum of 43%

Common tax

33%

Allowable deductions and tax credit

Maintenance allowance; university expenses; medical expenses (if they are over 129 EUR); dependent elderly or disabled persons; etc.

Special expatriate tax regime

Expatriates do not benefit from a special tax regime.

Double taxation treaties

Countries with whom a double taxation treaty have been signed: See the Ministry of Finance website
Whithholding taxes
Bilateral agreement

Sources of fiscal information

Tax Authorities: Italian tax agency
Other domestic resources: Finanzelavoro.it

Accounting rules

Tax year

The tax year begins on 1 January and finishes on 31 December of the same year.

Accounting standards

Since November 2001, the organization in charge of the harmonization and control of accounting standards has been the Italian Accounting Organization (Organismo Italiano di Contabilità - OIC). The OIC replaces the "Commissione Paritetica per la Statuizione dei Principi Contabili", a commission controlled by the two main accounting bodies in Italy and which has published 30 accounting standards. Italian accounting standards do not have force of law.

Accounting regulation bodies

Italian Accounting Organization (OIC)

Accounting reports

Italian companies must draw up in their financial statements the following documents:
- the balance sheet;
- the profit and loss accounts;
- the notes to the accounts;
- the annual report.

Publication

The annual report, the audit report, the financial statements and a copy of the minutes of the AGM must be filed with the company register 30 days after the AGM, and this filing must also be published in the official gazette of joint-stock companies (BURSAL).
Unlimited liability companies are not obliged to publish their accounts.
Companies listed on the Stock Exchange must draw up quarterly financial statements.
Unlimited liability companies (SNC, SAS) only have to draw up a balance sheet and a profit and loss account, with no obligatory form.
Small companies are authorized to draw up financial statements in a shorter form.

Professional accountancy bodies

CNDC, Consiglio Nazionale dei Dottori Commercialisti
INRC, Istituto Nazionale Revisori Contabili

Certification and auditing

The Civil Code obliges limited liability companies whose capital is more than 120 000 EUR to appoint, at the AGM (Assemblea dei soci) an audit committee (collegio sindicale) of three to five members who give an account of their audit in an annual report included in the financial statements of the company. This committee is appointed for three years and may be prolonged indefinitely. Since 2004, a "collegio sindicale" must contain at least one revisore contabile. The law does not impose any particular model of presentation of the audit report.
Companies listed on the Stock Exchange must have their accounts audited by external independent auditors (società di revisione).

The National Committee for companies and the Stock Exchange is an independent administrative authority whose role is to protect investors.

Accounting news