Italy

ITALIAN VAT

As with other members of the EU, Italy is obliged to follow the rules of EU-wide VAT, set out in VAT directives for Italian VAT registrations and returns. These rules set standard Italian VAT compliance requirements for each country. However, the setting of the main standard Italian VAT rate still rests with the Italian authorities.

ITALIAN VAT LAw

The Italian VAT law is contained within the specific VAT legislation and is backed up by case law from the Italian tax commission (Commissione Tributaria Provinciale). It is administered by the Ministry of Finance and the local tax offices.

ITALIAN VAT Registration

Foreign companies may register in Italy for VAT without the need to form a local company; this is known as non-resident VAT trading. There is no VAT threshold in Italy for the registration of non-resident traders; a VAT number must be in place before the commencement of taxable supplies.

There are strict rules on the situations where a registration is permitted. Common scenarios which require an Italian VAT registration include:

ITALIAN VAT COMPLIANCE

There are detailed rules controlling the recording and processing of Italian transactions. These include guidelines on:

ITALIAN VAT RATES

The standard VAT rate in Italy is 22%. There are also reduced VAT rates of 10% for pharmaceuticals, passenger transport, admission to cultural and entertainment events, hotels and restaurants; and 4% for foodstuffs, medical, books and e-books. There are many variations to the rates above, including exempt taxable supplies. Please contact us to learn more.

ITALIAN VAT RETURNS

Companies with an Italian VAT number must submit periodic payments. In Italy, payments are generally submitted monthly.

Italy has one of the harshest regimes for VAT non-compliance, and companies should ensure they are properly registered before they start trading. There is also a requirement to submit two annual returns in Italy in the following year.

ITALIAN INTRASTAT AND EC SALES LISTS

In addition to VAT returns in Italy, companies may be required to submit additional statistical information.

The Italian Intrastat, which lists sales (dispatches) and purchases (acquisitions), within the EU region must be filed monthly once the annual threshold is exceeded.

ITALIAN VAT REFUNDS

If a foreign company is providing taxable supplies in Italy, but is unable to obtain an Italian VAT number, or is incurring Italian VAT on local goods or services, then Italian VAT may be recovered through a VAT reclaim.

VAT refund applications are made through the tax authorities of the applicant’s home country.

Contact us

At AVASK our international team are easily accessible and are dedicated to assisting you no matter where you are situated in the world. We will work in accordance to your time zones, and can call you at a time convenient for you, saving you expensive international toll charges.

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