Opening a VAT number: how to do it and things to know about costs and tax regimes

The working relationship with VAT contract it affects various sectors and attracts many workers who aspire to this form of contract. However, when you decide to become autonomous, several doubts arise. But how …

Opening a VAT number: how to do it and things to know about costs and tax regimes

The working relationship with VAT contract it affects various sectors and attracts many workers who aspire to this form of contract. However, when you decide to become autonomous, several doubts arise. But how does a VAT number work, what are the categories involved, the costs and tax obligations? We see.

VAT number and Ateco code: what they are and how they work

The VAT number consists of a 11 digit code which serves to uniquely identify the committed economic operators operating on the national territory. This tax entity varies depending on the sector and the type of activity carried out. Based on this, a is assigned Ateco code, a combination of numbers and letters that identifies the scope of the various professional activities, based on the classification adopted by Istat for statistical purposes. The choice of the Ateco code can be complex and generate uncertainties. It is therefore advisable to rely on a trusted accountant for the entire process of opening the VAT number, able to suggest the code that best represents your work activity.

When you need to open it

The opening of the VAT number is an obligation for all workers with one status of freelancers. They are not bound by exclusive contracts and are not obliged to work for just one client, which allows them to have much more flexible working hours and manage them independently. Self-employed workers (i.e. non-employees) are required to open it with income exceeding 5,000 euros per year (threshold below which registration is not mandatory) or if they carry out a continuous activity (such as collaboration with a company that exceeds 30 days, or opening an e-commerce). The VAT number is necessary for every person who wants to issue an invoice for a good sold or a service provided, and is one of the fundamental steps for starting a business. It may coincide with the Tax Code, but only if the business is represented by a natural person.

Professional collaboration contract with VAT number

The professional collaboration contract with VAT number formalizes a work performance: the worker undertakes to carry out a work (or provide a service), for compensation, without constraints of subordination with the client. The characteristics of a contract with VAT number include the absence of time constraints, freedom in the choice of execution methods, a result to be achieved and compensation, in addition to the uniqueness and occasional nature of the service and the assumption of the economic risk by the self employed.

This type of contract is different from that of subordinate employment, which can be for a fixed or permanent period and involves the hiring of the worker by a company. Furthermore, in subordinate employment, taxes are withheld from the pay slip and paid to the treasury by the employer, while the employee receives a net amount on the paycheck. The self-employed worker instead receives a gross compensation, on which to calculate and pay taxes and social security contributions personally. The contract with VAT number may concern artisans, traders and freelancers.

Regardless of the category, you must pay the taxes to the Revenue Agency ei social security contributions to the relevant cash register. Not all workers with a VAT number must pay contributions to the INPS: artisans and traders, for example, fall under the institution's management of artisans and traders, while many freelancers (such as architects, lawyers, engineers, doctors, journalists, etc.), they have their own fund. Freelancers without a specific fund refer to the INPS separate management.

The worker with VAT number must fulfill various obligations, how to issue an invoice for the work carried out, fill in and send the tax return, fill in and submit, if necessary, the Intrastat form. It must be said that it is not always mandatory to draw up the professional collaboration contract with VAT number in written form. Often the parties produce a work order or performance contract, with a detailed description of the work and compensation.

Open a VAT number

The opening of the VAT number is a process relatively simple and free: simply go to the Revenue Agency with your identity card and tax code to activate the procedure. Otherwise, you can request it using the Agency's specific software, or by sending a registered letter with return receipt. During the procedure, it is necessary to choose, as mentioned, the Ateco code which identifies the specific activity, and the tax regime, as we will see shortly. Once the documentation has been approved, the Revenue Agency will assign the corresponding 11-digit code. Once you have obtained your VAT number, you must contact INPS (or your reference fund) to open one social security position. Furthermore, anyone who starts an individual business must register with the Chamber of Commerce and communicate the start-up of the business to the Municipality of residence.

Tax regimes

Opening a VAT number is an important step in starting your business. Among the many decisions to be made, there is choice of tax regime best suited to your needs. In Italy there are three main regimes: flat rate, simplified and ordinary, each with very specific characteristics, advantages and disadvantages. Let's see them in extreme summary:

  • The flat rate regime is designed for individual VAT numbers with an annual turnover not exceeding 85,000 euros, provides for a facilitated taxation with a substitute tax of 15% (reduced to 5% for the first 5 years of activity), exemption from VAT and the absence of accounting records obligations. It offers subsidized contributions for artisans and traders;
  • The simplified regime is aimed at individual VAT numbers and companies with a turnover that exceeds the limits of the flat rate, but which in any case does not exceed the maximum limits established for the ordinary regime (500,000 euros for services, 800,000 for other activities). It has less complex accounting management than the ordinary regime, while maintaining Irpef taxation with progressive rates based on income;
  • The ordinary regime it is the “general” regime, mandatory for joint-stock companies and VAT numbers that exceed the limits of the simplified regime, or that voluntarily choose to adopt it. It requires more complex accounting and tax management, but offers more flexibility in terms of deductions and deductions.


Having said that, let's deal with the costs: although opening the VAT number is free, they are there maintenance costs which must be considered and which vary depending on the activity and accounting regime chosen. As a freelancer, there are no fixed costs, but taxes and contributions must be paid as a percentage of takings. Even without issuing invoices, you must carry out the annual tax declarationmanaging it yourself or through an accountant.

For a sole proprietorship, they must be considered annual fixed costs such as the annual fee for the Chamber of Commerce, which ranges from 53 to 120 euros, the minimum INPS or INPS Artisans contributions, between 4,515.43 and 4,427.04 euros, in addition to the expenses for certified e-mail and digital signature, which amount to approximately 35 euros per year. We must then consider other expensesbased on the type of business, including rent, bills and condominium expenses, POS rent, warehouse rent, monthly shipping service fee, hosting and website domain.

Annual costs also differ based on geographical area. In Rome, for example, a VAT number with a flat rate regime can cost around 1,000 euros a year, while one with an ordinary regime can reach up to 10,000 euros per year.


THE main tax obligations for those who open a VAT number they include the issuing of the electronic invoice (not mandatory for all professionals), the compilation of the accounting registers with all the invoices issued and received, the recording of deductions, and also, liquidation, payment and periodic declaration of the VAT and annual VAT declaration. Professionals registered in the Business Register must then pay the annual chamber of commerce fee and comply with social security and social security contributions. Businesses and freelancers with VAT number who use a websitethey must obligatorily expose the code clearly on your site, generally in the header or on the home page in the footer, together with other essential data such as the name of the owner or company, the registered office, contact details, and the registration number in the Register of companies or professional register.

For correct management

Managing a VAT number requires attention and precision to avoid errors and penalties. It is therefore important to keep accurate records of all transactions, invoices issued and received, and expenses. Using accounting software can simplify this process. Compliance with tax deadlines is also fundamental: delays or omissions may result in penalties and late payment interest. It is also essential to correctly manage VAT obligations, apply the correct rates and respect the deadlines for periodic payments.

Again: you have to maintain a organized archive of tax documentation for at least 10 years, this includes invoices, receipts, contracts and documents

tax declaration. Finally, if you do not rely on an accountant, it is useful to keep your tax and legislative knowledge up to date to take advantage of any tax breaks or regulatory changes.