Italian tax code and foreign companies

20/01/2025   Category:  Businesses and Taxation

What is a Fiscal Code and When Is It Issued to Foreign Operators

The Codice Fiscale is an alphanumeric identification code, similar to the social security number in many countries, used in Italy to identify an individual for tax and administrative purposes. It is a key piece of information for interaction with public and private entities, as it is required for a number of everyday transactions, such as entering into contracts, opening bank accounts, accessing health services, and filing tax returns.

How the Tax Code is Composed

The Tax Code is composed of 16 characters:

• 6 letters:the first 6 letters are derived from the individual's first and last name, with a specific formula for making up the initials.
• 8 numbers: represent the individual's date of birth (year, month, and day).
• 2 letters: correspond to the sex of the individual (one letter for day of birth, one for sex).
• 4 final characters: which are a combination of numbers and letters, and serve to ensure the uniqueness of the code.

When Issued to Foreign Operators

The Fiscal Code is also required for foreign operators who undertake business in Italy or have dealings with Italian entities. The need for a Tax Code for foreigners may arise in several cases:

1. Work and Professional Activity:If a foreigner wishes to work in Italy or open a VAT number to carry out professional or commercial activities, he or she must compulsorily apply for a Tax Code.
2. Economic or Commercial Agreements: Foreign companies that undertake business or investment in Italy, or have tax relations with Italy, must register with the Italian tax authorities to obtain a Codice Fiscale.
3. Contracts and Transactions: In the case of lease, purchase or other transactions, it is necessary to complete the registration of the agreement. Foreigners who purchase real estate in Italy must also have a tax code.
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4. Access to Health and Other Services: Foreigners who stay in Italy for long periods can apply for a Codice Fiscale in order to access public health services and enjoy the benefits provided by Italian law.

Procedure for Requesting Fiscal Code

Requesting a Fiscal Code can be done directly at the Internal Revenue Service, with the presentation of a valid identity document (passport or ID card). Alternatively, if the foreign operator is not physically present in Italy, it is possible to use intermediaries or representatives to carry out the procedure on his behalf.

In general, the Fiscal Code is issued quickly, and is provided immediately after the person's registration with the appropriate office.

Conclusions

The Codice Fiscale is an essential element for anyone wishing to undertake economic or legal activities in Italy, regardless of nationality. For foreign operators, its application is essential to ensure compliance with Italian tax regulations, and its use extends to many areas of daily and working life in the country.