Italy VAT Information
If you are a foreign/cross-border business selling or planning to sell goods or services in the Italy, you may be required to register for VAT with the Agenzia Entrate (Italian tax office).
You can always review the latest Italian VAT regulations on the Italian Tax Office website.
Italy VAT Information
Italy introduced VAT in 1972, locally known as Imposta sul Valore Aggiunto (IVA). As a member of the European Union (EU), Italy has fully incorporated all EU VAT Directives into Italian VAT laws. The Italian VAT law covers all details of VAT registrations, compliance, returns, Intrastat and other related requirements. The Italian Ministry of Finance is responsible for regulating the VAT regime.
The standard VAT rate in Italy is 22%, however, some specific goods and services are charged at a reduced rate. These are as follows:
Standard Rate 22% - This rate applies t most generic goods
Reduced Rate 10% - Some foods, some medical equipment, some transportation, some hotel accommodation, restaurants, some agricultural products
Reduced Rate 5% - some food, social services and some local transports
Reduced Rate 4% - only applies to some foods, some medical equipment, some pharmaceuticals, selected books, newspapers, magazines
When Should You Register?
If you are a foreign / cross-border company providing taxable supplies in Italy, you may be required to register for VAT and comply with all associated accounting and payment requirements.
As of 2017, all Italian VAT returns must be submitted quarterly. The deadline for VAT filing is due on the last day of the second month following the reporting quarter end. In addition to quarterly VAT filing, an annual VAT return is required. The deadline for the annual VAT filing is on the 30th of April of the year following the reporting deadline.
You may also be required to report intrastat, movememnt of goods between EU states. This is often the case if you are trading on online market places such as amazon and are using fulfilment like FBA and have enrolled in Amazons PAN European program. Intrastat does not apply if the goods are imported from outside of Europe or being exported out of the EU.
Movement of goods between Italy and other EU States must be reported through intrastat.
Unlike most other EU member states, there are no Intrastat reporting thresholds for purchases or acquisitions.
Intrastat declarations are submitted monthly for businesses with arrivals or dispatches above €50,000 per annum. Otherwise they are reported quarterly.
VAT Registration Associated Fees and Timelines
All fee includes: VAT registration, documents translation, certification, fiscal representation and handling notification services.
The registration time scale is estimated and calculated from the time when all required documents have been received and relies on the current workload of the local tax authorities.
Price are in EUR. Prices exclude EORI application, EC Sales list and intrastat filing.
Frequently Asked Questions
Question: How can sellers tell if they need to add An Italian VAT number and company information to the seller platform?
Answer: If you are using a local warehouse in Italy, such as FBA Warehouse or 3PL Warehouse. You must register for VAT and provide the Italian VAT number and company information to the Amazon/eBay account.
Question: What is the Reverse VAT Regulation?
Answer: Reverse VAT is what we call the Italian local zero tax rate. The reverse VAT regulations are simply the following conditions: the seller guarantees that there is no office in Italy and that it is not an entity (i.e. in the name of a tax agent). The buyer must have a physical entity, a tax ID, and a VIES in order to invoice at zero rate
Question: What is a compliance letter (dunning letter) issued by the Italian Tax Office?
Answer: When the Inland Revenue Department does not receive the amount due on the customer (VAT number holder) tax electronic system drawer (e-tax account). Compliance letters will be issued to customers, which are initial warnings and if not corrected, will result in a formal penalty notice or a closer investigation of all sales transactions, up to the point of store closure.