Italy Agriturismo: How to Start a Profitable Activity

Are you considering the possibility of buying a rural property in Italy and converting it into an agriturismo? Do you prefer the quiet scenario of an Umbrian, a Tuscan agriturismo, or are you considering for example the beautiful Sicily?
Before starting, let’s have a preliminary focus on the the main topics that we will cover in this article to help you with the process:

• What is agritourism?

• How to start an agritourism?

• Italian agritourism legislation

• To start an agritourism: costs

Agriturismo Italy: introducing the legal steps

Starting an agritourism in Italy could be complicated and could involve many different aspects (real estate, legal, technical, commercial, and others). While you consider these aspects, having Italian professionals helping you through the legal and technical aspects could be very helpful.

As with many other businesses in Italy, to achieve success, there are certain requirements you need to consider. Starting with a deep knowledge of the local legislation will help you proceed in the right direction from the beginning. First, you need to consider the main legislative institutions – the national law regarding agritourism (Legge 96 febbraio 2006 – “Disciplina dell’agriturismo”), the different regional receptions and applications. Like the Tuscan law or the Lombardy one, and the specific municipal laws.

What is agritourism?

Before starting your own agritourism, it is important to have a wide knowledge of the ground you are going to operate in. Take your time to navigate the official Italian government portal in the English language regarding touristic activities in the countryside Here you will find the legal definition of agritourism.

To understand what kind of economic activity agritourism is, let’s start focusing on the main definition. “An agritourism is a reception and hospitality business managed by agricultural entrepreneurs (referred to the article 2135 of the Codice Civile – Civil Code). that could also be arranged as limited companies or partnerships, or associated with each other, by applying their business in connection with the activities of soil cultivation, forestry and animal husbandry.

Who’s in charge of the Agriturismo?

There is an important thing to note regarding workers in the agriturismo. The farmer’s family members could be included as workers in the business (as provided in Article 230-bis of the Civil Code) in addition to any temporary, permanent and part-time employees. Including external parties is only permitted to perform complementary activities and services.

A solid link to the territory

Agritourism is a growing extra-hotel business, enriched by the strong connection with the territory. This is because it offers a unique local experience with the typical features and products of Italian agriculture.
If you are deeply moved by the love for your land and the feeling of hospitality and sharing, starting an agritourism is the right choice for you.

How to start an agritourism business: requirements and obligations

Now that we have cleared the definition, we have to answer the most important question. What do we have to do to start an agritourism business?
Here we are going to explain every important aspect that you will have to consider – the legal aspect that you will have to respect in order to start your agritourism.

What do you need to start an agritourism

It is necessary to conform to a specific standard in order to start a new business, and this is also extended to agritourism. We will now analyze in detail every single fundamental requirement.

1) Get a VAT Number

As for all the business activities in Italy, if you want to start a business in the agricultural management field, first of all, you have to get the Italian VAT (Partita Iva). This is one of the prerequisites.

2) Apply at the Italian Business Register

Another fundamental requirement is the registration of your future business at the Italian Business Register (Registro delle Imprese – Register of Companies). The registration should be completed as usual at the competence Chamber of Commerce (Camera di Commercio), attaching all the necessary documentation.

3) Open a Tax Account

Another less known requirement for starting an agritourism is opening a tax account. This is simply a “virtual” account, very similar to a bank account. With this account, you can record debits and credits with the Italian Internal Revenue Service (Agenzia delle Entrate).
Through this account, payments and credits relating to income tax, substitute taxes, taxes paid based on supplementary declarations as well as IRAP and VAT are monitored.

4) Register at the regional register of agritourism operators

If you want to start agritourism, as well as a guesthouse, your business will be partially regulated by the relative region. Compared to American states, regions in Italy are less autonomous, but they can legislate regarding specific subjects like agriculture, schools, and public health.
Every Italian region has its own register regarding this matter, the Registro regionale degli operatori agrituristici. This is why enrolling at the regional register of tourism operators is part of the fundamental requirements to start your agritourism.

5) Receive the authorization from the municipality

Receiving authorization from the municipality of residence to carry out the business is crucial. The so-called “green light” from the municipal administration is another fundamental step before starting.
The type of authorization and the procedures for its release may vary from the municipality or from the region, requiring you, for example, to fill out the SCIA (Segnalazione Certificata di Inizio Attività).

How much land does it take to open an agritourism business?

As an agricultural business closely connected to the territory, if you decide to serve food and beverages (which by law must be mainly of your own production), you will need to cultivate a portion of land. This is necessary to meet the fundamental needs of your activity.

In Italy, there are standard tables you can use to calculate how much land is needed to open an agritourism, depending on the type of crop, the animals you want to raise, and the type of business. According to those tables, you can also calculate an estimate of the working hours needed for a particular surface of the soil to be managed.

Remember not to get excited about having a huge expanse of land. Think that you’ll have to cultivate it or, at least, make it beautiful and productive. A self-respecting Sicilian or Tuscan agritourism not only brings daily fresh products on the table but also manages to keep the surroundings of the building in perfect order, possibly with a garden full of flowers.

What are the requirements to start an agritourism in Italy?

In addition to what we have just listed, there are more requirements for opening an agritourism. Let’s have a look at the list below:

• Register at I.N.P.S. e I.N.A.I.L
• Ask permission from the fire department
• Ask permission to install any sign and road sign
• To obtain a health certificate
• Ask for a health permit for the premises
• Pay the waste tax
• Join trade associations

Legislation to start an agritourism in Italy

After having analyzed in detail the necessary fulfillments and requirements, it is now time to better understand what is and how the legislation for agritourism works. What is the law that regulates agritourism in Italy?

It is Law 96/2006 (Discipline of agritourism) which determines the definition we just saw and the general regulation, and also has, among its main purposes, the promotion of rural development. Having said that, it’s important to remember that this law transfers numerous competencies and responsibilities to the regions (like Tuscany, Emilia-Romagna, Piemonte, Lombardy), in defining the obligations and requirements for agritourism to be respected. This is why you should always check what your specific region requires.

The regions are responsible for 5 crucial points:

1. Criteria and limits of agritourism activities
2. Sanitary regulations
3. Qualification and fiscal discipline
4. Communications relating to opening periods and pricing
5. Funding to start an agritourism

The EU funding program: the importance of agritourism in 2022-2023

Even if it depends a lot on your situation, starting an agritourism in 2022-2023 without money is nearly impossible. Notwithstanding that, because it concerns rural development an agriturismo business can have access to public European funds. You may have access to incentives to open an agritourism site. In fact, funding for agritourism is usually part of the measures to support agricultural development, managed by the agricultural local departments.

The funding instruments are mainly the Rural Development Programs (Programmi di Sviluppo Rurale – PSR), in which general themes called “priority axes” are defined and that include various measures to improve both agricultural management businesses from a structural point of view and the agricultural and food system of the region.

PSR extended until December 31, 2022

These are the measures that legislate the agritourism, which holds the ceiling of financing through European funds for opening an agritourism (Regolamento della Commissione 69/2001 of 12 January 2001 on the application of Articles 87 and 88 of the EC Treaty) with 100,000 Euros per individual applicant over 3 years.

The 2014-2020 PSR has been extended until December 31, 2022, therefore very interesting also because it is supported by the package of recovery from the Covid-19 “Next Generation EU (NGEU)” emergency (for Italy corresponds to 910.6 million of EU resources). For more information on subsidies to start an agritourism in 2022, see the announcement published by the Italian Regions, referring to the allocation periods provided by the financial prediction framework of the European Union.

Agritourism tax legislation

Furthermore, we also need to consider that the costs to open an agritourism include the taxes relative to this type of business.
Agritourism is subject to a flat-rate tax system as it produces business income. Law 96/2006 says that in compliance with the provisions foreseen by the specific region involved, authorized with article 6, the fiscal provisions of the article 5 of Law 30 December 1991, n.413 are applied,as well as any other social security or sectoral regulation, referable to the agritourism activity.

Simplifying, the tax legislation for agritourism provides:

• For direct taxes: a flat-rate tax, on which will be applied a profitability coefficient of 25%
• For IVA: flat-rate tax with a reduction of 50% for taxable transactions
  It is always possible to adopt the ordinary regime for both direct taxes and IVA.

 

 

The contents of this page should not be taken as an authoritative statement of Italian law and practice. Neither the author nor the publisher are responsible for the results of actions taken on the basis of information contained in this summary, nor for any errors or omissions. This text is not intended to render legal, accounting or tax advice. Readers are encouraged to seek professional advice concerning specific matters before making any decision.