The Minimum Regime
When we speak of a 'regime dei minimi', we no longer refer to a company form, as in the case of the Srl, but rather to a facilitated tax regime. This preferential system can be adopted for a period not exceeding five years and with a substitute income tax of 5%.
In order to be able to adopt this favourable tax regime, there are requirements to be met, such as:

• • • Ceiling of 30,000 euro turnover per year

• • • Do not have any employees;

• • • Not having run or had a business activity in the three years preceding the time of application.

• • • It does not apply to agriculture, publishing, the arts and some others;

• • • The value of the assets to start the business must not exceed EUR 15,000.

Unlike in the case of the simplified limited company, where the upper age limit for setting it up is 35 years, in the case of the minimum regime there is no age limit but the requirements are only those listed above.

The 35-year threshold in the minimum regime, however, takes on a different role since, if you are younger, the 5-year maximum use limit is not to be observed. A very young person who has opened his or her own business can adopt the regime of minimum wage until the age of 35, while still meeting the requirements in terms of turnover and employees.

Advantages of the minimal regime
One of the advantages of the minimal regime is a bureaucratic advantage, as no sales ledger is required and no costs for an accountant are incurred. Furthermore, in the case of the minimal regime, there is no obligation to settle VAT at monthly or quarterly intervals and there is no need to pay IRAP.
Substantial tax benefits arise from Irpef, which is reduced from 20% to 5%.

However, persons who wish to take advantage of this tax benefit must also fulfil certain obligations: documenting all remuneration, keeping purchase and sales invoices in an accurate and numbered manner, and finally, tax returns are always mandatory, even if the turnover is zero euros.

We have therefore said that in order to take advantage of the minimum regime, it is necessary to have certain requirements but what happens if the requirements are lost during the year? In this case, it will no longer be possible to take advantage of the relief from the following year.

One advantage of minimum taxpayers, which is reflected in organisational and bureaucratic terms, is that of accounting: minimum taxpayers enjoy the possibility of drawing up simplified accounts if their revenue does not exceed the EUR 400,000 threshold.

In this respect, the simplified GmbH remains similar to the ordinary one in that it is required to keep books, approve the balance sheet and register in the commercial register.

So what is more convenient and advantageous?

In terms of costs, it is certainly more advantageous to open a sole proprietorship under the regime of minimums, in which case you initially pay the initial set-up costs but gain in terms of subsequent costs. Once registration has taken place, in the case of a sole proprietorship under the regime of minimums, the costs to be borne become much lower, while for the simplified limited company these are around 400 euros per year to which the annual management costs must be added.

In terms of risk and security, it must be said that the sole proprietor certainly has a greater liability than the partner of an LLC, who enjoys limited liability within the limits of his contribution. In the case of a sole proprietorship, the entrepreneur bears the risks and benefits.

The advantages of having a sole proprietorship with the minimum regime:

• • • no obligation to keep books

• • • high decision-making autonomy due to the absence of partners;

• • • initial capital is not necessary to start;

• • • the minimum requirements are few and simple.

The disadvantages of having a sole proprietorship are:

• • • unlimited liability: as the owner is jointly and severally liable for the company's obligations

• • • Taxation not in favour.

To conclude, let us examine the advantages and disadvantages of the simplified limited liability company. The advantages are:

• • • free notary fees at its inception and minimal initial costs;

• • • minimum share capital of 1 euro;

• • • limited liability;

• • • fixed rate and the possibility of increasing the membership by adding new members

The disadvantages instead are:

• • • the highest costs as an accountant and bookkeeping are involved;

• • • a certain amount of capital behind it is necessary to bear the initial expenses;

• • • obligation of ordinary bookkeeping and annual presentation of the balance sheet;

• • • low credibility of banks.

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