Services - Italy
The Directive 2006/123/EC of the European Parliament and of the Council of 12 December 2006 on services in the internal market (the “Bolkestein Directive”) was implemented with Legislative Decree No 59 of 26 March 2010.
The Directive deals with three major topics, concerning the removal of barriers to freedom of establishment, elimination of obstacles to the free movement of services and, finally, the establishment of mutual trust between Member States.
According to this Directive, Member States should examine the procedures and formalities applicable to access to a service activity and to its exercise.
In particular, the directive stipulates:
- the setting up of “One-stop shops”, through which providers can complete all necessary formalities to carry out their activities;
- the obligation to provide the means to complete these procedures electronically ;
- the elimination of legal and administrative obstacles in the services sector.
The Services Directive: One-stop shops
The Services Directive is a European law that aims to make life easier for businesses that wish to provide services in the European Union – in their home country or abroad. The Directive defines the rules that apply to entrepreneurs wishing to establish a business or perform temporary services in the EU/EEA area (the 27 EU member states, plus Iceland, Liechtenstein and Norway). It obliges member states to eliminate unnecessary bureaucracy, simplify formalities for businesses and make public administrations more efficient.
For the implementation of the Directive, each member state had to set up ‘Points of Single Contact (PSC)’ , e-government portals which help businesses complete their administrative procedures on-line. The PSCs provide comprehensive information on all administrative matters related to setting up or expanding a services business in a given country. This includes for example:
- Which licences, notifications or permits do I need to obtain to start a business (at home or abroad)?
- What do I need to do when I want to offer my services abroad on a temporary basis?
- What do I need to do to apply for a licence? Which authority is responsible?
- Are the licences subject to a fee? What kinds of deadlines apply?
- Which acts and decrees apply in my sector?
- What do I need to do to establish, for instance, a restaurant or a shop? Or to work as a tour operator in another country without actually setting up a company?
- Where can I turn for personalised advice and further information?
With the PSCs, you no longer need to approach various authorities one by one!! The PSC allows you to find all relevant information and to send in your online applications to the responsible authority through one single contact point, the PSC. You can complete your administrative formalities electronically through the PSC. Just contact the PSC of the country that you want to do business in.
All PSCs are part of the European EUGO network; through a central website you can easily access all PSCs in Europe. Of course, the services of the PSCs are optional. You may always address yourself directly to the relevant authorities, too.
Intra-Community transfers: requirements
An invoice must be sent in order to transfer or carry out services. With regard to the legal nature of the recipient, economic operators can confirm the validity of the VAT number provided by their EU-based clients with the competent Revenue Agency local to the territory in which they are fiscally domiciled.
This can also be confirmed through the Revenue Agency’s website.
In addition, Article 27 of Decree Law No 78/2010 plans new tasks for those who intend to carry out intra-Community operations. In general, it is stipulated that:
- the contributor states his intention of starting intra-Community operations when the VAT number is set up;
- the financial administration can deny this authorisation;
- contributors who set up intra-Community operations are placed in a special database by way of a census.
Invoices related to transfers of goods and services provided within the EU by national operators for entities subject to VAT in other Member States must:
- show the identification number for the VAT of the recipient or the client in the Member State in which they are based;
- be numbered progressively for each calendar year;
- include an indication that it is a non-taxable operation or the entity is exempt in the area where the amount taxed would be shown, with reference to the specific regulation.
As regards operations carried out in the territory of the State in which a non-resident operator is based, the above tasks can be carried out directly by that operator, if they are identified (Article 35c, VAT Decree), nominated in the way legally stipulated (Article 1, Presidential Decree No 441/1997) by one of their tax representatives in Italy.
Furthermore, the appointment of the tax representative is mandatory if a non-resident entity is not directly identified and carries out transfers of goods or service provision within Italy, which are liable for VAT towards recipients or clients who are not engaged in business activity, arts or professions (i.e. for operations conducted by private persons).
The obligations regarding transfers of goods and the provision of services carried out in the country of the non-resident entity which is not identified directly and has not nominated a tax representative, are to be fulfilled by recipients or clients resident in that country and who acquire the goods or use the services for company, art or profession purposes, through the particular mechanism of reverse charging or by self-invoicing.
The tax representative, whether a physical or a legal person, must be an entity with tax residency in Italy.
The same entity can represent various foreign operators and have as many VAT numbers as the number of subjects it represents.
Finally, the tax representative which must be nominated by public deed with an authenticated private agreement or a letter recorded in the appropriate VAT register, all of the tasks stipulated for the national operators.
In particular, he must:
- keep VAT registers as stipulated by Italian law;
- record the invoices sent out by the non-resident operator;
- record the invoices received;
- pay off any tax;
- present the VAT statement on a periodical and annual basis;
- indicate all of the variations related to the business of the non-resident entity to the competent VAT office;
- issue the invoices for sales, with the VAT applied, to the client entity which is subject to taxation in Italy.
Proof of qualifications
All foreign citizens - Community and non-Community - who plan to exercise a professional activity in Italy can request recognition of professional qualifications attained abroad.
Work permit applications
For the purposes of self-employment and reporting the start-up/change of activity to the Business Register by foreign business owners, there is a distinction between:
- European Union Citizens (or countries with equal status);
- Non-EU citizens.
EU citizens have the right to settle in Italy, while non-EU citizens require particular documents (visa and valid residency permit) to enter Italy and stay there to become self-employed.
Check also the legislation on this topic in: