Starting a short term rental business in Italy: tips and suggestions
What are short-term rentals (also known as tourist rentals)?
A short-term rental agreement is a “simple” tool for turning your current property into a source of income that can be either a primary source or something extra on the side. If you are looking for an easy way to make your “second home” profitable without having to drop your whole life and attend to the every need of a potential project, this is certainly the best choice you can make without a major direct commitment.
In fact, you can make your property income for a maximum of 30 days per guest without technically operating as a business, at least under the current guidelines as stated in Italian legislation.
The features of short-term rentals
- They must be registered as residential properties
- The maximum overnight stay is 30 days per guest
- Contracts must be signed by individual, physical persons
There is a set number of services that you can offer, which is limited to supplying linen, changing sheets and the cleaning of the premises. Anything outside these services puts you at risk of falling under the label of “running a business”. In that case you will have to open a partita iva.
This means that following the above guidelines can help you in establishing a small side project without ever falling into the business burdens of the Italian tax system.
Management of short term rentals
While you don’t have to register your “company” with the chamber of commerce, you will certainly have to register your guests on the AlloggiatiWeb portal, which requires a sort of declaration that said guests will be staying in your place of residence.
This is necessary regardless of whether they are coming from outside or from within the European Union. Since this registration is clearly going to be a constant for anyone opening up such a business in the Italian market, be sure to familiarize yourself with the process as it will be one of your go-to procedures.
Some Municipalities (known as the Comune) require you to file a communication notifying them of your short term rental; furthermore, your local Comune might levy tourist tax. If that is the case, you must register online, and pay tourist tax quarterly. Make sure to comply with the local Comune requirements for this.
Most of the tourist tax are between 1 and 3€ per day per person.
If you are getting in on this activity for the first time, we recommend getting in touch with the central police station in your area for feedback and guidelines on the procedure, as any help or advice for such an essential process could pay dividends in the future.
Accepting Payments and Paying Taxes
Rental income must be reported in the RB section of your tax return, but the advantage you will have is that instead of paying personal income tax, the owner can opt for a flat rate tax, which can certainly be beneficial.
Why should I consider short-term rentals?
What we’ve provided you with is a very brief overview of the issue at hand, and there is much more to consider. As with any “business” in Italy, a good accountant is key in assisting you with your ventures and can provide you with specific information that is particular to your situation.
Short term Rental in Italy in 2020
Italian rivieras all around the coast, are planning and implementing social distancing measures as instructed by the government.
For any questions or concerns, feel free to get in touch with us at your earliest convenience, as we’re always ready to help you make the jump to starting a business and setting up a company in Italy.