As they have Italian Passports they will need to register on the EU Foreign Citizens Register.
(Please don't confuse things by speaking about Residencia, that woulfd have applied if they did not have EU passports)
In Andalusia we do that at the National Police. It can vary from Region to Region believe. You have not made it clear exactly where they are inSpain.
If they intend to stay for 3 months or more then they should register at once. I have no idea where the info about waiting until next year came from. It is wrong.
As they have been here so long they should have registered long ago.
Once registered they will automatically become tax resident and be required to make a tax Return. As they will register this year that will be about May / June 2013, However, if they have been in Sp[ain for 183 days total in any year they are already Tax resident and should have made tax returns (on the world wide assets).
I suggest they seek some professional advice. See a Gestor.
This message was last edited by johnzx on 20/02/2012.