Being a freelancer in the digital world means the freedom to pack up your computer, choose a destination, and work from anywhere you like. You can do things like indulge in a well-deserved workation, where you take your work with you on your go during your travels. It’s important to remember, though, that every country has its own rules when it comes to digital nomads—especially if you’re planning on staying for more than a few weeks.
In Italy, freelance work is growing in popularity. According to the stats, 13.8% of the population does freelance work, and more than 30% of those people are under 40. More and more Italian cities are becoming “smart cities,” offering infrastructure and services that hugely benefit freelancers and digital nomads.
So, what is it really like to freelance in Italy? If you’re considering running your freelance business here—even for a short time—you’ll want to check out our guide to all the things you should consider before your arrival. Read on to learn more about freelancing in Italy as an expat.
Taxes and VAT for EU freelancers in Italy
If you’re an EU citizen who’s already registered as a freelancer in another EU country, and you’re only planning on staying in Italy for a few months, you won’t have to get a separate Italian VAT number, necessarily. In fact, there’s no rule within the European Union that prohibits working from another member country, so using another EU VAT number is no problem, as long as the move isn’t permanent. The so-called “183 days” rule generally applies for those planning on freelancing in Italy. This rule means:
- Anyone freelancing abroad for less than 183 days per year is subject to the tax laws belonging to their country of residence.
- Anyone freelancing abroad for more than 183 non-continuous days a year can choose to keep filing their taxes in their country of residence.
Basically, if you intend to spend less than six months total in Italy, you won’t be forced to transfer your tax residence to the country. If you are considering making Italy your permanent home, you have two options:
- You may choose to transfer your tax residence to Italy
- Or, you can pay your taxes both in Italy and the country in which you opened your VAT number.
The “183 days” and double taxation rules depend on the type of freelance business you run, and on the conventions in place between Italy and your previous country—especially when dealing with non-EU countries. That’s why it’s a good idea to research the type of taxation you may be subject to before you arrive. Also, check out the website from the Department of Finance of the Italian Republic, regarding the agreements between countries to avoid double taxation. And finally, visit the Italian Tax Revenue Agency website for more information on tax residency under Italian law.
Once you arrive in Italy you’ll need to register your residence there, regardless of your tax situation. As an EU citizen, you’ll have three months to go to the registration office in the municipality where you’ve moved to get your residence.
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Taxes and VAT for non-EU freelancers in Italy
If you’re a freelancer from a non-EU country but are hoping to work in Italy, there are some documents that you’ll need to secure before leaving your previous country:
- an entry Visa
- a Nulla Osta (security clearance) issued by the Police Headquarters
- Residence Permit for Self-Employment
Double check the visa requirements between Italy and your country of citizenship. You can find this information on the website from the Italian Ministry of Foreign Affairs.
As a non-EU citizen, you will most likely have to apply for a self-employment entry visa (which lasts 90 days) at an Italian institutions in your current country, such as an Italian consulate and embassy.
There’s a limit on the number of non-EU citizens that can enter Italy for work each year. This quota is set annually by a specific decree known as the Flows Decree. Because of this, your arrival into Italy must be authorized by the Police Headquarters. You’ll have to request this document at the Police Headquarters yourself, or delegate someone to do it for you.
If you want to stay more than 90 days, you’ll have 8 working days from the date of your arrival to apply for a residence permit for self-employment. This document gives you legal permission to reside in Italy for a prolonged period and has to be be requested from the Immigration Office at the Police Headquarters. You’ll need to make sure you have the license or authorization documents for the activity you intend to carry out, or you’ll need to be registered with the Chamber of Commerce. That registration will require the following documents:
- the application form
- a valid passport or equivalent document
- entry visa, if required
- a photocopy of your ID card
- 4 identical and recent passport-size photos
- required documents for the self-employment visa (more information can be found on the National Insurance Institute (INPS) portal, in Italian)
- a €16.00 duty stamp for the completed application
- €30.00 to send the registered letter to the Italian Post Office
- a contribution payment for the issuing of a residence permit, which ranges between €27.50 and €227.50
The reason and length of the stay are always indicated on the permit. On top of allowing you to work as a freelancer, this document will also let you:
- enjoy all the rights and services given to foreigners residing in Italy.
- register on the civil records lists and receive an ID card and tax code, which allows you to to apply for health care, open a bank account, etc.
While you’re waiting for your residence permit to be issued, you can legally reside in Italy, and, if your entry visa allows for it, continue to work. A residence permit for self-employed workers has a maximum duration of two years.
How does opening a VAT number in Italy work?
If you decide to transfer your tax residence to Italy along with your business operations, you’ll need to request the following—regardless of whether you are an EU citizen or not:
- Italian tax code
- a VAT number for freelance work
Your tax code, which is equivalent to the US Social Security Card or the UK National Insurance Number, is a 16-character alphanumeric code. You’ll need this code in order to:
- register with the National Health Service
- open a business in your name
- enter into a contract (e.g., rent, sales, etc.)
- sign up for a bank account.
Simply visit a consulate or a Revenue Agency office to request your tax code. You’ll need to present a valid ID or your passport. As we’ve already mentioned, you’re automatically assigned a tax code if you’re a non-EU citizen who has applied for permanent residency in Italy. If, for whatever reason, you find yourself without a tax code and you’re a non-EU citizen, you can apply for one by presenting your residence permit at a Revenue Agency office.
Your VAT number is an identification code that each individual or company linked to economic activity has to have in order to start a business in Italy. You’ll need to go to a local Revenue Agency with your ID and the AA9/8 form for natural persons (individual companies and self-employed workers) in order to get your unique VAT number for self-employed individuals. You can also apply through the post office, Revenue Agency website, or by contacting an intermediary, such as an accountant or a Tax Assistance Center (CAF) in your area. For more information, you can check out the relevant section on the Revenue Agency website.
What are the advantages of having a VAT number in Italy?
There are many types of tax regimes in Italy. Depending on what you need, there can be many advantages to the VAT number, including tax and accounting simplifications and a reduced level of taxation for some categories. It’s recommended that you consult an accountant to get a full overview of the advantages and disadvantages for you and to understand whether it’s convenient for your business to register for VAT.
Once you open your VAT number, you’ll be required to track the economic movements of your business. Specifically, you’ll have to register the invoices that you issue and receive. You’ll also need to prepare and submit your tax declaration for holders of a VAT number every year. If you’ve registered with the Chamber of Commerce, you’ll also need to pay the annual fee for membership there. For an overview of all the taxes a freelancer needs to pay in Italy, check out our calendar that includes tax deadlines for those with VAT numbers. Still have questions? Contact an accountant or the CAF (Centro di Assistenza Fiscale) center nearest you.
Working as a freelancer in Italy with N26
If you’re going to be working in Italy, an Italian bank account can make your life much simpler. N26 is the 100% mobile bank, with services in English, Italian, Spanish, French, or German. Best of all, we’ve designed a range of bank accounts specifically with freelancers in mind. Sign up for our free N26 Business Standard account and receive 0.1% cashback on every purchase you make with your N26 Mastercard. Or, upgrade to one of our premium plans for even more cashback and perks like Spaces sub-accounts and extensive insurance packages. Visit our compare page to find the plan that’s right for you. For more information on who can sign up for a N26 business bank account, check out this page.