Sign up for tax alert emails    GTNU homepage    Tax newsroom    Email document    Print document    Download document

September 23, 2021
2021-5986

Italy: New VAT rules on e-invoicing of cross-border transactions and pre-populated VAT ledgers and returns

As of 1 January 2022, new Italian value-added tax (VAT) rules will apply regarding:

  • Electronic invoicing (e-invoicing) for cross-border transactions
  • Pre-populated VAT ledgers and VAT returns

The scope of e-invoicing is to be extended for cross-border transactions. In addition, the Italian Revenue Agency (IRA) has started using the relevant data to draft VAT ledgers and VAT returns, which will be made available to taxpayers for their validation or integration.

E-invoicing of cross-border transactions          

In accordance with art. 1 (Section 1103) of the 2021 Budget Law (Law no. 178 dated 30 December 2020), cross-border transactions will be subject to e-invoicing effective from 1 January 2022.

Taxable persons established in Italy will have to e-file through the e-invoicing Interchange System (SDI) the data pertaining to:

  • Accounts Receivable (AR) transactions performed with non-established customers within the deadline for the issuance of the invoice (i.e., 12th day following the taxable event)
  • Accounts Payable (AP) transactions performed with non-established suppliers by the 15th day of the month following the month when the invoice was received, or the taxable event occurred

Based on the current technical requirements, it is expected that established operators will need to generate an XML document to be sent to the tax authorities via the SDI for both AR and AP cross-border transactions.

Specifically, the reverse-charge on AP cross-border invoices will be accomplished through an electronic self-invoice to be sent to the SDI; the “document type” code to be included in the XML needs to be properly identified depending on the underlying transaction (e.g., TD17 for cross-border supplies of services, TD18 for intra-European Union acquisition of goods).

Consequently, the Esterometro return will no longer apply for transactions carried out as from 1 January 2022.

Pre-populated VAT ledgers and VAT returns

The IRA (via Provvedimento no. 183994 dated 8 July 2021, issued based on art. 4 of Legislative Decree no. 127/2015) announced that, on a trial basis, starting with transactions carried out from 1 July 2021, they will make available the following draft documents to Italian-established taxpayers:

  • VAT ledgers, regularly updated with collected information, from the first day until the last day of the month following the reference quarter
  • Quarterly VAT communications (Li.Pe.), available from the sixth day of the second month following the reference quarter

Starting from 2022, the IRA will make available also the draft annual VAT return (from the 10th of February of the year following the one of reference).

Until the end of Fiscal Year (FY) 2022, these draft documents will be prepared by the tax authorities only for taxpayers who perform (by option) the VAT calculation on a quarterly basis. Moreover, some taxable persons are excluded from this simplification (e.g., those using special VAT regimes, VAT groups, Public Administration, some retailers, and health service providers).

Taxpayers may validate or add information to the draft VAT ledgers (the consultation is available from 13 September 2021 for the third quarter of FY 2022). In this case, in principle, the taxpayer is exempted from maintaining the VAT ledgers since these are considered maintained by the tax authorities on his behalf (unless some derogations apply).

Taxpayers may access the draft documents via the IRA’s web-portal, using their own credentials or by engaging an intermediary (e.g., a tax professional) who has been duly appointed to act for them.

_________________________________________

For additional information with respect to this Alert, please contact the following:

Studio Legale Tributario, Rome

Studio Legale Tributario, Milan

Studio Legale Tributario, Treviso

Studio Legale Tributario, Turin

 
 

The information contained herein is general in nature and is not intended, and should not be construed, as legal, accounting or tax advice or opinion provided by Ernst & Young LLP to the reader. The reader also is cautioned that this material may not be applicable to, or suitable for, the reader's specific circumstances or needs, and may require consideration of non-tax and other tax factors if any action is to be contemplated. The reader should contact his or her Ernst & Young LLP or other tax professional prior to taking any action based upon this information. Ernst & Young LLP assumes no obligation to inform the reader of any changes in tax laws or other factors that could affect the information contained herein.

 

Copyright © 2024, Ernst & Young LLP.

 

All rights reserved. No part of this document may be reproduced, retransmitted or otherwise redistributed in any form or by any means, electronic or mechanical, including by photocopying, facsimile transmission, recording, rekeying, or using any information storage and retrieval system, without written permission from Ernst & Young LLP.

 

Any U.S. tax advice contained herein was not intended or written to be used, and cannot be used, by the recipient for the purpose of avoiding penalties that may be imposed under the Internal Revenue Code or applicable state or local tax law provisions.

 

"EY" refers to the global organisation, and may refer to one or more, of the member firms of Ernst & Young Global Limited, each of which is a separate legal entity. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients.

 

Privacy  |  Cookies  |  BCR  |  Legal  |  Global Code of Conduct Opt out of all email from EY Global Limited.

 


Cookie Settings

This site uses cookies to provide you with a personalized browsing experience and allows us to understand more about you. More information on the cookies we use can be found here. By clicking 'Yes, I accept' you agree and consent to our use of cookies. More information on what these cookies are and how we use them, including how you can manage them, is outlined in our Privacy Notice. Please note that your decision to decline the use of cookies is limited to this site only, and not in relation to other EY sites or ey.com. Please refer to the privacy notice/policy on these sites for more information.


Yes, I accept         Find out more