To start an e-commerce business in Italy, one of the first steps is obtaining a value-added tax identification number (VAT ID). To do so, you must select the appropriate Classification of Economic Activity (ATECO) code for e-commerce. The ATECO code is a numeric identifier that specifies the type of activity carried out by a company or professional.

This article examines the most appropriate ATECO code for starting an e-commerce business in Italy, the codes for other types of online activities, and the procedures for selecting or changing a code.

What’s in this article?

• ATECO code for e-commerce
  
• ATECO codes for other activities related to online sales
  
• Key business models for e-commerce activities
  
• How to choose or change your ATECO code for e-commerce
  

ATECO code for e-commerce

The ATECO code for e-commerce is 47.91.10: “Retail trade of all types of products via the internet”. This code must be included when applying for a VAT ID, whether you are starting your own e-commerce business or selling products on third-party platforms and marketplaces. This code covers both physical products, such as clothing or books, and digital products, such as e-books, music, or online courses.

The main limitation of this code is it focuses only on buying and selling. If you buy a product and resell it or a third party manufactures it for resale, you fall under the ATECO e-commerce code. If you create the product yourself and then sell it, you must use a different ATECO code, which varies according to the sector and the type of product you produce, as your activity is classified as artisanal.

Origins and purpose of the ATECO code

The ATECO code is the Italian equivalent of the statistical classification of economic activities in the European Community (NACE) code, which was created in 1970 by the Statistical Office of the European Union (Eurostat) to provide a centralised system for classifying economic activities in EU member countries. The ATECO code has been adapted by the National Institute of Statistics (Istat) to the characteristics of the Italian economic system, allowing it to uniquely identify the primary activity carried out by a company or self-employed person in Italy.

The ATECO code is an alphanumeric code in which the letters indicate the economic macrosector. For example, “A” corresponds to agriculture, while “C” indicates manufacturing industries. The numbers range from two to six digits and refer to the categories and subcategories of the macrosectors. ATECO codes have a tree-like structure: the further down the levels, the more in depth the activity is described.

For example, the structure of the ATECO code to arrive at the description of ecommerce activity follows this logic:

• G: Wholesale and retail trade; Repair of motor vehicles and motorcycles
  
• 47: Retail trade (excluding motor vehicles and motorcycles)
  
• 47.9: Retail trade not in stores, stalls, or markets
  
• 47.91: Retail sale via mail order or internet
  
• 47.91.10: Retail sale of any type of product via the internet
  

The ATECO code is important for starting any economic activity and is particularly important for fiscal purposes, such as calculating contributions, receiving government subsidies or bonuses, determining the risk band in occupational safety, and participating in public tenders.

ATECO codes for other activities related to online sales

The ATECO e-commerce code (47.91.10) is specifically designed for activities involving the sale of products, both physical and digital, directly to the customer via the internet.

If you want to start an online marketplace – a platform where third parties can sell their products – you will need to choose a different ATECO code. Usually, a marketplace falls under brokerage activities, which are classified under ATECO code 63.12 for web portals. This code also covers platforms that provide content or other services to users but excludes activities such as publishing books, newspapers, and magazines on the internet.

A wide range of business activities can be conducted online, each of which corresponds to a different ATECO code. Here are some examples:

ATECO code search

To find the ATECO code for your activity, you can visit the Istat website and search by activity description, activity code, or keyword.

If you are planning to start an e-commerce business, there are several factors to consider beyond obtaining a VAT ID and choosing an ATECO code for e-commerce, such as choosing a payment service provider (PSP). Choosing the right provider is important to managing payments efficiently and quickly, as well as having access to the most suitable payment methods for your type of business. Solutions such as Stripe Payments, with its Optimized Checkout Suite, allow you to accept payments globally, both online and in person, increase conversion rates, ensure compliance, and save thousands of hours of technical work.

Key business models for e-commerce activities

The main business models for e-commerce activities are:

• B2C: In this model, a business sells products or services directly to customers (e.g. an online clothing store where individuals can purchase items directly).

• B2B: In this model, a business sells to another business (e.g. a software company that provides its accounting software solutions to other companies).

• Consumer-to-consumer (C2C): In this business model, individuals sell to other individuals. An example of this is an app where an individual can sell used clothes to customers.

• Consumer-to-business (C2B): In this model, the customer sells to businesses rather than to other customers. An example of this is a platform where individuals offer their skills to companies seeking their services, such as a company that needs freelance translators or copywriters but doesn’t want to hire full-time employees.

Dropshipping: A special case

One particular business model is dropshipping, which involves three stages:

• The customer makes the order and pays the list price.
  
• The seller forwards the order to the supplier, paying the wholesale price.
  
• The vendor sends the purchased product directly to the customer.
  

This model is particularly cost-effective due to the lack of inventory and warehousing. In addition, the risk is low because the products are not purchased in advance.

In this case, the appropriate ATECO code to choose is 73.11.02: “Conducting marketing campaigns and other advertising services”. You should use this ATECO code instead of the one for e-commerce because dropshipping is focused on promoting products sold by third parties.

How to choose or change your ATECO code for e-commerce

If your business performs multiple activities, you can apply for more than one ATECO code when you get your VAT ID. You can also add another ATECO code later. For example, if you already have a physical store and you want to expand your business online, you will need to add the e-commerce ATECO code 47.91.10.

There is no specific procedure for requesting an ATECO code. Instead, it's one of the details you must provide when obtaining your VAT ID. To obtain your VAT ID, you must use one of the two forms provided:

• Form AA9/12 for individuals

• Form AA7/10 for entities other than individuals

Any change in the ATECO code or the addition of a new one must be reported to the Italian revenue agency (Agenzia delle Entrate) using the same two forms.

Consequences of choosing the wrong ATECO code

It's important to carefully choose the ATECO code for your business or rely on a trusted accountant. Choosing an incorrect ATECO code can lead to consequences that can include financial penalties because you might pay less tax than you should. For example, an incorrect ATECO code could cause problems related to:

• Social security fund: An incorrect code could result in payment to the wrong social security fund.
  
• Registration with the Chamber of Commerce: This is mandatory for sole proprietorships but not for freelancers.
  
• Professional organisations: The wrong ATECO code could cause you to fail to register with an organisation that may be mandatory for your professional activity.
  
• Insurance for workers: An incorrect code could affect registration with the Italian National Institute for Insurance against Accidents at Work (INAIL), which is mandatory in some cases.
  

As for taxpayers who adhere to the flat-rate scheme, an incorrect ATECO code would result in the assignment of an incorrect profitability coefficient, which could result in errors in the calculation of taxes.