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MOVING TO ITALY

Freelance or employee: Which is the best way to work in Italy?

Wondering how you can secure work in Italy? We weigh up the pros and cons of going self-employed or being on the payroll.

The city of Milan is the top destination for foreigners seeking work in Italy.
The city of Milan is the top destination for foreigners looking for work in Italy. Photo by Ouael Ben Salah on Unsplash

Moving in Italy is the dream for many, but it probably involves finding a way to support yourself financially.

Italy doesn’t have the best reputation for employment opportunities, and the Covid-19 pandemic hasn’t helped: unemployment has risen and the country reported its biggest shrinkage in GDP since the end of World War II.

But that doesn’t mean it’s impossible to find work here – particularly if you have relevant skills and experience.

And for foreign nationals moving to Italy, there are some financial advantages.

READ ALSO: The 25 most in-demand jobs and skills in Italy in 2022

“Contrary to popular belief, this is a good time to move to Italy for work,” said tax and finance expert Nicolò Bolla of Accounting Bolla

“There are tax deductions for newcomers to the country, meaning that if you’re smart enough, you could find a position that allows you to enjoy the Italian lifestyle and bring in more income.”

So when planning your move, which type of employment should you look at?

In tumultuous times, it may be tempting to go down the employed route for security. But it’s not that black and white – and choosing one path doesn’t preclude you from changing your mind later.

“You can be flexible. If you come to Italy as a freelancer, you can then become an employee and vice versa,” Bolla said.

The first questions you should ask yourself

Your country of origin is the jumping-off point. EU nationals can stay and work in Italy with a much more straightforward set of rules, whereas non-EU citizens have plenty more bureaucratic hoops to jump through.

Since Britain left the EU this year, Brits are now counted as third country nationals, along with Americans and Candians, for example. This means the benefits of free movement to live and work across Europe are now lost.

Once you’ve taken into account where you are coming from and the paperwork that implies, where do you start?

Choosing self-employment or employment can depend on your qualifications, experience and field of work.

READ ALSO: ‘Smart working’? Here’s what you need to know about going self-employed in Italy

Photo: Andreas Solaro/AFP

“If you have a college degree or a Masters degree, it’s usually better to come to Italy as an employee. You’re more likely to get hired, which can give you an ‘in’, an entry to living here,” stated Bolla.

It’s also more probable you’ll get a job this way from a statistical point of view. Italy has an annual quota for how many people can enter the country to work under the so-called Decreto Flussi (Flow Decree).

Each year, this caps the number of workers coming from outside the EEA. For 2022, the government set the limit at 69,700 – more than double the number allowed in previous years in total.

However, the number of permits available also depends on the type of work you plan to do. Out of that overall figure, there’s an allowance for just 500 self-employed workers, a figure which remains unchanged on previous years.

READ ALSO: How many people does Italy grant work permits to every year?

This means competition is high, and gaining a self-employment visa – which allows you to come to Italy as a freelancer – has one of the highest rejection rates.

“You have a lower chance of being turned down as an employee. Given that getting a self-employment visa is hotly vyed for and you have to prove your work history, as well as have a cash back-up, this route is harder than employment,” Bolla advised.

The annual cap on working in Italy might not apply to you

However, it’s not the same story for all careers. There are some categories of professionals who fall outside of this bracket and are not subject to a fixed allowance.

“There’s a limit on mid-level workers and seasonal workers, but there is no quota for highly-skilled professionals with a degree,” added Bolla.

Often referred to simply as ‘Article 27’, this section of European law provides an exemption for non-EU workers who fall outside of national quotas within the EU.

ICT workers, highly skilled executives or managerial employees working in the Italian branch of a foreign legal firm, artists, journalists, university lecturers and professors, translators, interpreters and nurses are some of the occupations excluded from the cap.

Instead of being subject to the annual competition, these highly qualified individuals can apply for the EU’s Blue Card.

To be eligible, you must have secured a work contract of at least one year, have a minimum gross salary of €24,789.93 per year and have documentation of your qualifications.

The processing time for getting one of these cards is up to 90 days and costs €100. 

Details of which category you might fall into are detailed on the EU’s immigration portal.

Working for a company doesn’t get you off the administrative hook

If you don’t qualify for a Blue Card and think you can clinch one of the annual employment spots granted by the Italian government, the onus is still on you to sort out your paperwork and you cannot rely solely on your employer.

“Companies might hold your hand through the bureaucracy and may even offer you a relocation package, but it is still the responsibility of the employee to get their papers in order. That means organising a work visa and proving you have a place of accommodation,” warned Bolla.

A work visa is a kind of Italian Long Stay visa and to get that, you need a work permit. This is called a Nulla Osta, which your Italian employer has to apply for at their local Immigration Office (Sportello Unico d’Immigrazione – SUI).

READ ALSO: What’s the difference between Italian residency and citizenship?

Once you get that from your employer, you can apply for the work visa in your home country at your consulate. From there, you have the ability to enter Italy, but still need to apply for an Italian residence permit within 8 days of arriving in Italy. The permesso di soggiorno is the documentation that allows you to legally live and work in the country.

Further to this, there’s more administration to be done in Italy, which depends on the country you’re coming from and your specific circumstances.

How can you do this if you’re not in the country? Bolla advises getting a proxy, such as an accountant or lawyer, who can navigate the system for you: “You need to provide the power of attorney to someone in Italy, who can deal with the paperwork for you and gather all the relevant documents, thereby representing you and acting on your behalf.”

Some of this documentation could include:

  • Copy of your signed work contract.
  • The original and a copy of your Nulla Osta.
  • Diplomas/certificates
  • Completed Long-Stay visa application
  • Passport with at least two blank pages, valid for at least three months after the duration of your visa.
  • Passport pictures
  • Proof of accommodation in Italy
  • Proof of sufficient funds

The Italian Ministry of Foreign Affairs has an updated visa portal to check what you might need, depending on your country of origin – the Italian authorities could ask you for any documentation they deem necessary.

Of course, it is allowed and possible for you to handle the paperwork yourself if you spend some time in Italy as a tourist before you begin work – and if your Italian language skills are up to scratch.

“The problem with moving through Italian bureaucracy is the language. Immigration policies are tough the world over, but the particular hurdle in Italy is needing to go through everything in Italian,” Bolla said.

In other countries, there may be the option to apply in English, but that’s not the case in Italy.

He points out that this is “the bottom line”, adding that, “If you don’t speak Italian, you can’t figure it out. If there are translations on an immigration office’s website, it’s usually poor and doesn’t make sense.”

‘Going freelance isn’t as hard as people make out’

If taking the employed route seems overwhelming, surely the small national quota and paperwork involved must be even tougher if you want to be self-employed in Italy?

Since the pandemic catalysed a change in how Italians do business, moving jobs to a digital environment, now could be the ideal time to go freelance in Italy.

It might require persistence and patience, but it’s the preferred option for accountant Bolla: “I would rather freelance, as it’s easier to make more money,” he claimed.

“People make it seem harder than it is by saying becoming a freelancer in Italy is impossible. It isn’t,” he added.

READ ALSO:

Of course, how much money you make depends on your personal ambition and connections too.

However, a benefit of being self-employed is that there is no limit to your earning power. As an employee, on the other hand, you know what’s landing in your account every month – unless your wage fluctuates with commission.

There’s also a good degree of flexibility. If you’re self-employed, you can diversify your revenue streams. For example, you could work as a teacher by day and run an e-commerce site by night.

Bolla points out that all you need is a partita IVA (VAT number) and if you want to do different types of jobs, you have to log them under different income codes known as a ‘codice ATECO‘, which has to be communicated to the Revenue Agency (Agenzia delle Entrate).

You would also have to check your business activity is compliant with the law and may need to ask permission to trade from your local comune (Town Hall).

Being self-employed is also an opportunity to have clients in the U.S. or U.K. and receive a higher pay compared to Italy, according to Bolla.

“If you’re smart enough, you can get a higher, foreign wage, but live the Italian lifestyle,” he said.

There’s a double taxation agreement in place to ensure you don’t pay tax twice if you choose to work with international clients.

Photo: Luca Bravo/Unsplash

How taxation of employees and the self-employed compares

It’s undeniable that it’s more straightforward to be an employee, as your national security contributions, or INPS (Istituto nazionale della previdenza sociale’), and personal income tax known as ‘IRPEF’ are taken at source.

On the other hand, as a freelancer you have to put money aside for paying these yourself.

There’s also a little help from an employer with paying INPS – they stump up two-thirds of your social security contributions, with the remaining third coming from you. The self-employed are responsible for paying INPS solely.

READ ALSO: Working remotely from Italy: What are the rules for foreigners?

How much income tax you pay as an employee varies depending on your gross earnings, varying between 23% – 43%, according to the Agenzie delle Entrate.

As a new self-employed professional, on the other hand, you could set up under the so-called Forfettario regime, which means you pay 5% flat tax for five years. Italian authorities introduced this tax scheme in a bid to encourage new commercial activity from sole traders and small businesses.

It’s also worth remembering that as an employee, there are various deductions, such as health insurance if you work in a chemical plant, for instance. This changes according to the profession and there’s no one-size-fits-all answer.

Equally, there are professional liability insurances you may need to take out yourself if you go freelance.

Being an employee also grants you a bonus if and when you leave a position. TFR, Il Trattamento di Fine Rapporto (the Staff Severance Fund), pays out a lump sum when you finish a contract with an employer. It amounts to 6.91% of an annual salary and is calculated on the years and months of service, potentially making for a tidy sum if you change jobs.

Consider your personality as well as your paycheck

Beyond money, there’s also the matter of Italian business culture to take into account. 

“Culturally, Italy has always been a country that prefers certainty over risk, so people would rather be an employee than self-employed,” claimed Bolla.

“There isn’t a corporate mindset and it’s hard to climb the ladder. Large businesses are normally family-run and so family members are likely to get hired and promoted. This can be a problem for people coming from outside Italy,” he added.

READ ALSO: ‘It’s crazy’: What to expect when you work for an Italian company

“So the question is: ‘Can you work with Italians?’ If you can deal with a different work ethos and get culturally adjusted, it’s a great place for people to live,” said Bolla.

There are plenty of steps to take into account, whichever route to working in Italy you may plump for. But it’s not impossible. With time, organisation and a strong stomach for bureaucracy, you too could be living out your career goals in il bel paese.

This is an updated version of an article originally published in 2021.

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For members

VISAS

How to apply for an Italian elective residency visa from the UK

If you're a non-EU UK resident or a British citizen who wants to move to Italy post-Brexit, the elective residency visa is one of the options available to you. Here's how to apply from the UK.

How to apply for an Italian elective residency visa from the UK

Since Brexit was finalised at the start of 2021, British nationals who want to relocate to Italy have been in the same boat as all other extra-EU citizens, requiring a visa to make the move.

For those who receive a passive income and don’t need to work, the elective residency/residence visa (ERV) is a popular choice – though the application process can be confusing.

EXPLAINED: How to apply for an elective residency visa to move to Italy

A recent survey conducted by the Local on the experiences of British citizens moving to Italy post-Brexit found that a number of respondents – mostly retirees – had applied or attempted to apply for this visa.

However many described the process as being far more onerous, complex and stressful than they had anticipated.

One couple who were on their second attempt strongly advised retaining a lawyer, as they found that the information provided by the Italian authorities was not clear or detailed enough to allow for a successful application.

READ ALSO: ‘Seek legal advice’: Your advice on applying for Italian visas post-Brexit

The Local spoke to three experts about how to maximise your chances of success when applying for the ERV.

Most of the advice given was relevant to anyone intending to apply for the ERV, but some related specifically to the experience of people applying from the UK; we’ve compiled that information here.

Because where you’re applying from – rather than your nationality – is the main thing that matters for this application process, this guidance applies equally to non-British citizens who are legally resident in the UK.

Here’s what you need to know if you’re applying for the ERV as a British resident.

Going through an agency

If you want to apply for an ERV from the UK, you’ll likely need to go through VFS Global, an outsourcing agency that handles visa applications for the UK’s Italian consulates.

This is different to how the application process works for people in countries like the US, Canada, or Australia, who usually need to apply directly to the Italian consulate closest to where they are legally resident.

Most UK applicants, by contrast, deal exclusively with VFS Global, whose representatives conduct the appointment, review the documentation and deliver the application to the consulate on their behalf.

Some of the Local’s readers have said they felt penalised by the requirement to go through a third party middleman, as it blocks them from having direct contact with anyone with at the consulate.

But Nick Metta from Studio Legale Metta says going through an agency can actually provide an advantage, as their representatives tend to be well-versed in all the ERV requirements. “Basically they can do a pre-check, and usually that will avoid you the denial letter,” he says.

Agencies can assist you in making sure all your paperwork is in order.

Agencies can assist you in making sure all your paperwork is in order. Photo: Andreas Solaro/AFP

In the absence of an agency, he says, the consular staff member tasked with conducting ERV meetings is often “a front office handler who in most cases is not very well-versed in Italian regulations or requirements,” – some of whom have provided his clients with incorrect information in the past.

Elze Obrikyte from Giambrone & Partners, who regularly assists UK clients with ERV applications, says that the involvement of an agency also means UK applicants have more flexibility about where – and therefore when – they can book an appointment.

For example, while US applicants have to wait for a slot at their nearest consulate to open up, someone in London has the option to book an appointment at VFS’s application centre in, e.g., Edinburgh, potentially fast-tracking the process for those who are keen to get started.

READ ALSO: EU Blue Card: Who can get one in Italy and how do you apply?

What’s required

VFS Global’s checklist says applicants for the ERV in the UK should have:

    • A completed application form, which can be obtained from your consulate.
    • Two recent passport photos.
    • A passport that is valid until at least 90 days after the requested ERV would expire, plus two copies of the front page and of all Schengen visas issued in the past three years.
    • For non-British citizens, a UK residence permit.
    • A cover letter explaining why you intend to move to Italy.
    • Detailed documentation showing “substantial and stable private income”, including official letters from the banks or financial institutions listed (this must be passive income, as ERV recipients are not allowed to work once they arrive in Italy). 
    • Your last two years of income tax returns.
    • A registered ownership deed or rental lease agreement for property in Italy.
    • A reservation for a one-way ticket to Italy.
    • A marriage certificate for those applying as a married couple, and/or a birth certificate showing both parents’ names for dependent minors.

Applying for an ERV to move from the UK to Italy requires a substantial amount of paperwork.

Applying for an ERV to move from the UK to Italy requires a substantial amount of paperwork. Photo: Filippo Monteforte/AFP

Advice for UK applicants

Giuditta Petreni, who assists clients with ERV applications at Mazzeschi Legal Counsels, says she believes the ERV process has been getting tougher for UK-based applicants in recent years.

Obrikyte says she thinks consulates have become more strict in general over the past decade, but has observed that British applicants tend to struggle more with the application process than their North American counterparts.

“I see that most of them tend to be not well prepared for this type of application, while American and Canadian citizens, they’ve been living in this situation for years, so they prepare better,” she says.

READ ALSO: From visas to language: What Americans can expect when retiring in Italy

British applicants, by contrast, “tend to submit the application without actually putting a lot of effort in and then they are surprised when the application is rejected.”

Obrikyte says one key area where applicants often fall down is the cover letter explaining why they want to move to Italy.

In her experience, ‘pre-rejections’ – provisional refusals that give applicants the opportunity to fix an unsatisfactory aspect of their application before the final decision is made – are often issued on the basis of this letter alone.

She says that when asked to write a motivation letter, her clients will often write about loving the food or the weather. “This is not enough,” says Obrikyte.

READ ALSO: Visas and residency permits: How to move to Italy (and stay here)

“You must really convince them that, for example, you have purchased a property, you have already been spending a lot of time in Italy, and you are integrated in that neighbourhood.”

“Italian language is not a requirement for this visa, but of course if you mention that you are studying Italian or you know Italian, which helps you to integrate better, this is also an advantage for your application.”

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