A cooperative is a specific type of company in which the primary focus is not solely on making a profit, but above all on promoting the interests of its members. The members join together to pursue economic, social or professional objectives collectively.
The legal basis for cooperatives is set out in Articles 2511 et seq. of the Italian Civil Code.
A cooperative is characterized in particular by the following features:
Cooperatives may, for example, be established by employees, producers, farmers or consumers.
An important distinction is that between cooperatives with predominant mutuality and other cooperatives.
A cooperative has this status if it carries out its activities predominantly with or for the benefit of its members. This classification is particularly relevant for the application of certain tax concessions.
The following steps, in particular, are required to set up a cooperative:
In principle, a cooperative can be formed with just a small number of members, provided the legal requirements are met.
Cooperatives are generally subject to the Italian corporate tax (IRES). Further information on IRES can be found in our glossary entry on IRES.
Special tax rules apply to cooperatives. In particular, cooperatives with a predominantly mutualist structure may, under certain conditions, benefit from tax advantages, for example in connection with the allocation of profits to indivisible reserves.