Moving to Italy - Keeping my UK Ltd company
Jan 13th 2007, 1:57 pm
#1
Just Joined
Thread Starter
Joined: Jan 2007
Posts: 1
Moving to Italy - Keeping my UK Ltd company
Hi
I'm going to move to italy probably for the next few years at least.
To start i will be renting a flat possibly looking to buy a house when possible.
I currently do freelance website development through my own uk limited company and will be able to continue this work while living there.
I'd prefer to keep my tax affairs in the UK as much as possible as the italian ones seem pretty complex and i won't actually be working for italian companies.
What is the best arrangement for me in terms of residency? Do i need to become a resident of italy if i spend most of my time here? Can i elect to file taxes in the UK still?
I'm also thinking of setting up another company for a website i'm creating, internet focused but different to my regular work.
Should this be set up in the UK too or is there any advantage to setting up a non resident company somewhere else since i will be selling internationally.
I realise i'm going to need specialist advice for these matters - but i would appreciate some basics to help me work out the things to ask and be aware of.
Also recommendations of how to find a specialist would be very helpful too.
Thanks
Ben
I'm going to move to italy probably for the next few years at least.
To start i will be renting a flat possibly looking to buy a house when possible.
I currently do freelance website development through my own uk limited company and will be able to continue this work while living there.
I'd prefer to keep my tax affairs in the UK as much as possible as the italian ones seem pretty complex and i won't actually be working for italian companies.
What is the best arrangement for me in terms of residency? Do i need to become a resident of italy if i spend most of my time here? Can i elect to file taxes in the UK still?
I'm also thinking of setting up another company for a website i'm creating, internet focused but different to my regular work.
Should this be set up in the UK too or is there any advantage to setting up a non resident company somewhere else since i will be selling internationally.
I realise i'm going to need specialist advice for these matters - but i would appreciate some basics to help me work out the things to ask and be aware of.
Also recommendations of how to find a specialist would be very helpful too.
Thanks
Ben
Jan 13th 2007, 5:42 pm
#2
BE Enthusiast
Joined: Jan 2007
Location: UK ex Rome
Posts: 690
Re: Moving to Italy - Keeping my UK Ltd company
Ben,
People have stayed in Italy for years and remained outside of the system but it is illegal. In any case once you try to do the normal things like open bank accounts, buy and register cars, set up utility supplies etc you will find it necessary to become registered with a permesso di soggiorno (even if there are constant rumours of this document disappearing for EU citizens), certificato di residenza, codici fiscale etc.
I am not a financial professional but as I understand it you become resident for tax purposes if you spend more than 6 months in an EU country. To achieve this you only need be anagrafically resident in Italy even if you have not formally registered (i.e. someone could squeal on you). At that point all your worldwide earned income will be taxable in Italy, this will include benefits such as cars, rental allowances etc. If you have unearned income in the UK (rent from property, dividends, interest etc) this will generally be taxable in the UK. Basically you would file tax returns both in the UK and Italy.
I do not know if there are advantages in setting up companies in Italy but given the general levels of bureaucracy here I imagine that it could be a bit complex. I know of individuals who have set up companies in the Channel Islands as there seems to be some advantage there.
As for professional advice I guess broadly this would fall into 2 categories; relocation (for house hunting and the bureaucracy) and financial (for taxation, business advice etc). I could only say that you probably get what you pay for i.e. the cheapest may not turn out to be in the long run.
People have stayed in Italy for years and remained outside of the system but it is illegal. In any case once you try to do the normal things like open bank accounts, buy and register cars, set up utility supplies etc you will find it necessary to become registered with a permesso di soggiorno (even if there are constant rumours of this document disappearing for EU citizens), certificato di residenza, codici fiscale etc.
I am not a financial professional but as I understand it you become resident for tax purposes if you spend more than 6 months in an EU country. To achieve this you only need be anagrafically resident in Italy even if you have not formally registered (i.e. someone could squeal on you). At that point all your worldwide earned income will be taxable in Italy, this will include benefits such as cars, rental allowances etc. If you have unearned income in the UK (rent from property, dividends, interest etc) this will generally be taxable in the UK. Basically you would file tax returns both in the UK and Italy.
I do not know if there are advantages in setting up companies in Italy but given the general levels of bureaucracy here I imagine that it could be a bit complex. I know of individuals who have set up companies in the Channel Islands as there seems to be some advantage there.
As for professional advice I guess broadly this would fall into 2 categories; relocation (for house hunting and the bureaucracy) and financial (for taxation, business advice etc). I could only say that you probably get what you pay for i.e. the cheapest may not turn out to be in the long run.
Jan 19th 2007, 4:30 pm
#3
Just Joined
Joined: Jan 2007
Posts: 1
Re: Moving to Italy - Keeping my UK Ltd company
Hi Ben,
I'm in a very similar situation - so I'd appreciate it if you'd post anything you find out.
As far as I can tell, you can be resident in both the UK and Italy if you spend at least 91 days a year in the UK. This might not be possible for you but this is what I'm considering at the moment. Then under the double taxation agreement, if you have a permanent home in both countries (not necessarily your own home), I think you can argue that the UK is your 'centre for vital interests' and be taxed there rather than Italy. See this pdf file for more details:
http://www.hmrc.gov.uk/pdfs/2002_03/..._etc/ir302.pdf
If you can't spend more than 91 days a year in the UK then I think you will have to be taxed in Italy.
This page has relevant questions
http://www.hmrc.gov.uk/cnr/faqs_general.htm
Laura.
I'm in a very similar situation - so I'd appreciate it if you'd post anything you find out.
As far as I can tell, you can be resident in both the UK and Italy if you spend at least 91 days a year in the UK. This might not be possible for you but this is what I'm considering at the moment. Then under the double taxation agreement, if you have a permanent home in both countries (not necessarily your own home), I think you can argue that the UK is your 'centre for vital interests' and be taxed there rather than Italy. See this pdf file for more details:
http://www.hmrc.gov.uk/pdfs/2002_03/..._etc/ir302.pdf
If you can't spend more than 91 days a year in the UK then I think you will have to be taxed in Italy.
This page has relevant questions
http://www.hmrc.gov.uk/cnr/faqs_general.htm
Laura.
