Italian Light Branch

Light BranchA Light Branch is an excellent choice for any business which want to expand into Italy, but want to avoid all the costs associated with incorporating a new subsidiary.

  • A Light Branch has all the capabilities of a Representative Office;
  • It has a company number and it is duly registered at the Chamber of Commerce (companies house);
  • It is registered at the Italian Labour Office, so you can employ in Italy (in fact, it’s forbidden to employ a long term employee in Italy through a foreign company);
  • Like a Representative Office, a Light Branch can NOT send invoices.

I guess you are thinking “if a Light Branch can’t send invoices, how can it be useful to expand my business?”. Well, it can, but it isn’t a solution for everyone.

  1. If you run a traditional business, if you produce in Italy, or if you have a stock house in Italy, the Light Branch is NOT for you. You should probably setup a more traditional Italian limited company or a branch.
  2. On the contrary, if you run a call center, provide IT assistance online, or any other case where you run the business from your own country, you maybe need a sales team in Italy. You probably want a secretary and a few sales managers driving all around Italy to promote your services. That’s when the Light Branch is the best solution.

In short a Light Branch is a Representative Office that can employ or – to use the words of one of my client from Gujarat (India) – a light branch is a ‘representative office on steroids’.

  • A Light Branch is NOT not required to keep statutory books nor publish financial statements;
  • Because the Light Branch does not invoice,  it is not required to file income tax or VAT returns;
  • There is no need to pay an accountant (this is probably why some accountants go ballistic when I speak about this solution in conferences);
  • The annual government tax is quite cheap .

The traditional expenses (e.g. staff costs, office equipment, supplies etc.) can be covered directly by your foreign company.

Some of my clients have no office at all. The secretary works from home, and they use a virtual office provider.

One last note

There is no record of Light Branches in the Italian Civil Code, our major corporate law. Italy is one of the rare country where the law is older than the Constitution. There was still a king in Italy when the Civil Code was issued (1939), while the Constitution has been approved after the Second World War (1947).

New laws followed, authorizing this activities but none of them gave an official name to this “less than a branch but more than a representative office” entity. So if your consultant looks confused by the word “Light Branch”, just ask him to setup a representative office. Then ask him to register it at the Labour Office. You will get the same results.

Image source: Dubber at

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32 Responses

  1. Stefano,

    I’m owner of a US LLC and I’m hoping to hire a person, maybe more than one, in Napoli. Our first hire will be for a traditional long term employment contract, but we will likely bring in others on project contracts in the coming months. We are not intending to do sales in Italy, however, if the right opportunity presented itself we would, of course, take it. My questions are as follows:

    1. Is light branch a solution since we are not planning to invoice, only looking to hire?
    2. Can I pay the employee directly out of a US bank account or must I transfer the funds to an italian account?
    3. If we did invoice, could we invoice directly from the US office? The development may not be done in Italy anyway as most of the team is currently in the US. (software/web development)
    4. Can you direct me to the necessary web resources or help me file them if necessary? (I can read and write italian very well)



    1. Hi Mike

      there are NO web resource to help you file the documents by yourself. Italy has a very (very very) sophisticated regulation, when it’s not a pure … mess.

      Yes a light branch is enough, if you just have to employ a few persons and you don’t have to invoice. Of course, if these employee provide added value in Italy (i.e. consultancy) you SHOULD invoice from Italy accordingly.

      The other questions are a case by case, and I can’t reply in a blog. In the next weeks I will try to find a list of names of accountants used to deal with foreign clients, and post them in the website. Unfortunately I don’t serve small companies.

      Anyway, welcome in Italy!

  2. Hello Stefano.
    Thank (Thank Thank) for your useful website .
    We are Georgian (Out of EU) VOIP (Voice Over IP, Internet Telephony) company.
    We have clients in italy, but they can’t use electronic money transfer services, like Visa,PayPal an others.
    Our Problem is to how get cash from our clients in italy. light branch is good idea( It’s enough?)? or LTD ?
    In this case need permit from italian Ministry of Telecommunications ?

    1. Hello George

      apologies for bragging. My first job in Italy was the startup of a major telecom company called Wind (Orange) as employee number 8. I am always a bit emotional when someone want to start a telecom venture.

      Back to your question. The Italian branch could be a good solution. And there in NO need for a licence in the landline and voip market (on the contrary, you need a licence to provide mobile services).

      Yes you need a permit, but it’s much simpler than a licence. The support of a professional is mandatory in my opinion.

  3. HI Stefano,

    We are a Canadian based promotional products company that wants to set up a light branch in Italy. I have an employee in the in Asia who has been with me for more than 2 year and she works remotely for me. I want her to manage the Italian branch as I manage the Florida branch while my business partner is managing the Canadian branch.

    I know a good friend in Italy who can set up the branch in our behalf and I understand that I just need to give him a power of attorney to make the inquiries. I am only hiring him for this specific job.

    Now my question is, given the situation, would it create a problem with the immigration process for my employee in Asia as I will appoint her as the branch manager? She knows the ins and outs of the company already and I trust her to carry on the job.

    Thank you in advance.

  4. Dear Stefano,

    your blog is tremendously helpful, clear, transparent and simple considering you are dealing and explaining Italian laws and regulations which are not simple at all.
    I am an Italian-American citizen owning a travel company in the US selling tours and experiences all over the Italian peninsula. I have a few questions:

    The business is active completely online, purchases are done through a .com and ecommerce website. We then hire professionals (tour guides and suppliers) here in Italy to deliver our services. We invoice from the States to our clients and our suppliers receive our money through paypal. My partner and I though do operate almost full time from Rome, Italy due to logystic reasons. Do you think I need to open an Italian branch, office, light branch, subsidiary office? What would be most common in the travel industry due to the weird, obsolete and old laws that govern this industry?

    Thank you.

  5. Dear Stefano,

    I have launched a comme v. type company in Belgium. For a number of reasons, I decided to have my stock house in Italy (Matera). My products will vary from educational books to items such as (CDs, T-shirts, games…). All at the purpose of educating children. For the coming few months, I am not thinking in hiring employees. Alternatively, I do selling by my own in the local market in here, or more effectively via AMAZON. My concern is only if having selling activities in Italy whilst Belgian papers and invoices would bring me troubles?. I mean, would the Italian taxation come to me asking for a fine or annual taxation? or whatever?. My residence in the EU is valid till 2019, therefore, I do not think a visa or so is required for my stay in Italy. If any, renting a small office might improve the status: I go with this choice. Then in brief: my be/vat is Belgian, residence too, and invoices. Just the matter is the house stock and direct marketing is in here: Italia. Any advise?. Many thanks!. Susan

    1. Dear Susan,

      If you decide to operate in Italy, you have to open a branch and invoice (and pay taxes) in Italy. It’s all about how much deeply you think to work in Italy.

      1. Ciao,

        Grazie for the reply. As it is a new company (only three months at work), then I do not pay taxes in Belgium during the first three years. Only social service + medical insurance = up to 3000 Euros/year + my VAT value is low 6%. I have no idea how it is in Italy. If it is equal, then perhaps not a bad idea to branch in here.

      2. Grazie!,

        Mi pardone, but what if I ONLY DO PACKING and SELLING VIA AMAZON from Italy?. I do not need to do invoices (or pay taxes) as long as the revenue goes to the main company account ONLY in Belgium, isn’t it?.

        Per favore?

  6. Buongiorno,

    Attualmente sto lavorando per un sito tedesco per la vendita online di occhiali e lenti a contatto e stiamo sviluppando la pagina in italiano per poter vendere i nostri prodotti online anche in Italia.
    Tuttavia il percorso sembra non è essere molto semplice.
    La soluzione per poter vendere occhiali da prescrizione e lenti a contatto online in Italia, sembrerebbe essere quella di avere un ottico italiano registrato in Italia che possa essere la nostra “sede legale”. Dopo un meeting, sembra che la possibilità di lanciare il sito quest’anno possa essere rimandata a causa dei possibili costi di avere una sede legale in Italia. Essendo una start-up, non si vorrebbe investire troppo per avere una sede in un paese ancora sconosciuto per il nostro sito. Volevo sapere se la possibilità di avere un ottico che faccia da garante, senza avere la presenza fisica di un negozio in Italia, sia effetivamente possibile e quali potrebbero essere i potenziali costi per fare ciò. La questione è abbastanza spinosa in quanto si tratta di prodotti che implicano, almeno in Italia un contatto diretto per la vendita.
    Volevo inoltre sapere, se fosse possibile avere delucidazioni riguardo al campo dell’ottica online. Ho già conttato diverse persone a questo riguardo, ma tuttavia le informazioni non sono del tutto chiare.
    Grazie per l’attenzione.
    Cordiali Saluti

    1. Gentile Laura,

      Ritengo che non si possa ovviare chiedendo ad un ottico di fare da “prestanome” (questa sarebbe la sua posizione in sostanza). D’altronde, aprire una light branch non avrebbe grossi costi.
      In alternativa, si può pensare ad aprire una startup in Italia, la nuova legge in materia prevede un investimento di 50000 euro.
      Sarebbe opportuno riflettere su questi aspetti. Successivamente, si potrebbe affrontare la questione dell’ottica online.
      Cordiali saluti

  7. Hello Stefano and Michele,

    First, thank you for the great site! Very helpful!

    We’re a small rep company (less than 20 employees) based in the US with a sister company in the UK. We’d like to place one of our US account managers in Milan to help serve some of our clients in the area. Would a light branch work for this situation?

    The account manager could work from her home office and her salary would be paid by our US or UK office. With a light branch, would we be able to sponsor her and her family to Italy for an extended period?

    Thank you!

    1. A light branch can’t invoice. If you invoice through your UK sister company, then light branch is enough. Otherwise, you have to open a subsidiary in Italy.
      Anyway, the legal representative of the light branch/subsidiary in Italy shall be: Italian, UE citizen, or foreigner with already a permit to stay in Italy. And the account manager will be an employee different from him.
      Hope I am clear; anyway, you ask.

      1. Thank you, Michele! We wouldn’t be invoicing from Italy, so a light branch will work.

        For the “legal representative”, could that be a consultant we hire to do the paperwork of registering for a representative office? If so, would you be able to send me some recommendations of consultants for the Milan area?

        Thank you very much!

        1. Of course, Grace!
          Were you thinking of a budget for the legal representative, just to “shorten” the list of professional to search for?

  8. Hi, Stefano

    We are a Canada Tourism company. We want to register a light branch in Italy. Could you contact me?

    Best regards,

    John Zhang

  9. Hi Stefano, I am thinking of expanding my UK business to Italy.

    In order to purchase the products we require in Italy, we need to have a local company set up.

    The local company would purchase the stock from another local company & export it out of Italy.

    Would services would I need? (I wont be living in Italy & do not need any employees) I.E What type of company would I need to set up? Do I need a virtual address? Do I need a local bank account? Does the company need to be associated with the UK business? Do you recommend to have all the local law atterneys from Italy?

    I appreciate your help.

  10. Hello Stefano and Michele,

    Very helpful material here!
    How quick and easy (cost-wise) will be to close the light branch?

    Please let me know.

    Steve L Seal

  11. Hi,
    We are telecom company registered in India. As per some contract with an Italian company, we would like to send some employees from India, as well hire some (2-3) from Italy. They will work at Italian company premises.
    In this case, do i need to open a light branch office or branch office. The contract is with the Italian company with my company registered in India. If my 2-3 employees needs to work there at client side, what kind of visa they need. They need to work for 2 years.

    1. you need branch office, definitely.
      your employees will need work permit (that is the final step in the immigration procedure)
      if interested, we can give you quotations for the necessary services

  12. Hi,
    I run a company which provides short (5-10 day) art workshops in Rome. Clients purchase the workshops via a website based in California, where the company is located. We hire instructors in the U.S. and fly them to Rome to teach for the period of the workshop. Up to now I traveled to Rome only when we had a workshop running, but now I want to hire someone in Rome to organize things. What kind of structure would allow me to keep taking payments online in USD and providing the workshops?

    1. Hi David, personally I would keep selling trough your California company. A US company is much better for e-commerce. If you need to organize a workshop in Italy, you can set up a separate (small and cheap) company in Italy. This company will bill the US company. Or you can employ someone in Italy (such as a professional working as a sole trader). This is a good general solution. You case may be different. So I would suggest to contact a local lawyer with good understanding of international customers.

  13. Hi
    Our Pvt Ltd is registered in India. From last three year, we are organizing research conference. Every year we organize two conference one in Europe and other in Asia Participant of our European conference fill problem to send registration fee in Indian bank account. And I am residing in Italy as a PhD student. I own 98% share in Indian company but not taking salary there. As I am taking salary/stipend from my University here so I cant become director of Italian company. I want to register company in Italy and invite my one employee from India and make him director of my Italian company, I shall be shareholder and he will open bank account in Italy and he pay tax here also.

  14. Salve, risiedo in UK e sono proprietario di una Delaware LLC che utilizzo per fornire servizi di sviluppo su web.
    Ho ricevuto una ottima proposta per lo sviluppo di un applicativo particolare. Il problema è che le figure professionali che mi servono per questo sviluppo specifico sono in Italia e non disposte facilmente a spostarsi qui in UK o in US.
    Secondo lei la soluzione per la mia LLC di aprire una light branch in Italia e tramite questa assumere queste figure professionali che sviluppino per la LLC in Delaware potrebbe essere una soluzione o determinerebbe una stabile organizzazione in Italia con conseguente tassazione e burocrazia varia ? La LLC fatturerebbe ad una società nel Regno Unito e la light branch in italia sarebbe un mero centro di costo. Grazie in anticipo. Saluti


  15. Hello,

    Thank you for righting about the light branch, this might be interesting for our UK based (I know they brexit-ed but this isn’t a problem right?) Coffee company which can send the invoices to the end customer.

    If the volume becomes enough then it makes sense to create a s.r.l. or s.s.r.l.

    I want to utilize the Light Branch for export into Europe as the UK is scrutinized. Thanks

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