When do I have to submit
VAT returns in Italy?
- If you sell goods in several European countries including Italy and exceed the EU-wide delivery threshold of € 10,000, you have to submit a VAT return.
- This is because if you cross the threshold, you are subject to VAT in all European countries to which you sell.
- VAT registrations and the filing of VAT returns are then mandatory.
- This does not apply if you participate in the OSS program and only sell goods in Italy, but do not store them (see below).
- As soon as you store goods in Italy or another European country, you are subject to VAT.
- This includes both independent storage and storage through a fulfillment program or through a fulfillment provider with warehouses in Italy.
- In all of these cases, you will need to register for VAT and also start filing VAT returns in Italy.
- When you participate in an FBA program, you authorize Amazon to store your goods in a variety of countries, depending on the program.
- For example, under the PAN-EU program, goods are stored in a large number of Western European countries, including Spain, France and Italy.
- If you participate in a program, you must register for VAT in all participating countries, as your goods may be stored there in the future.
- Every sale from a warehouse in Italy to Italian customers via Amazon must then be declared in Italy and listed there in the VAT return.
Do you distance sell more than € 10,000 EU-wide or do you store goods in Italy?
This means that you must first register for VAT in Italy and then start filing VAT returns there. But don’t worry! If you contact us, we can support you in handling VAT tasks such as registration and filings. You can continue to focus on growing your business in Italy.
How to file
VAT Returns in Italy
VAT returns in Italy need to be filed online through the Italian Target System via the Comunicazione Liquidazioni Periodiche IVA every quarter. While prior to 2017, only a yearly VAT return and monthly payments were required, ever since then quarterly VAT returns and Invoice listings are mandatory. Annual returns are still part of the italian VAT regime.
The quarterly VAT returns in Italy are due on the last day of each month following the previous tax period, while the annual VAT returns need to be filed by the 30th of April. In general, all businesses must pay VAT due every month. However, Businesses with a turnover below € 700,000 can choose to pay quarterly if they pay a 1% non-refundable surcharge.
To file Italian VAT returns it is necessary to register for VAT and to apply for an Italian VAT ID. In order to do so, the application and the following documents need to be submitted to the tax office of the businesses legal agent
- VAT certificate
- latest audited company accounts
- registration for intra-community supplies
- Industry classification form
- Declaration that business does not have establishment in Italy
- Letter of Authorization of legal representative (if necessary)
While EU entities are not obliged to appoint a representative, non-EU businesses selling in Italy are required to appoint a fiscal representative. The Italian tax authorities fine late payments of VAT with around 30% and an interest charge of 2.5% is added every year. Overall penalties can reach up to 240% if returns are late or incomplete. That’s why, even though a fiscal representative in Italy is not required for EU businesses, employing one might be helpful and save money in the long run.
You can simplify both VAT registration and the filing of VAT returns in Italy by using the hellotax VAT automation tool. We help you automate VAT payments, but also correspond with the authorities and make sure you stay VAT compliant!
The EU-wide delivery threshold and OSS
Until recently, exceeding country-specific delivery thresholds, such as the Italian threshold of € 35,000, was the decisive factor for VAT liability. This was changed in July 2021. The first € 10,000 of distance selling will continue to be taxed at the VAT rate of the home country, VAT will be paid and the returns will be submitted there. However, if the net turnover of B2C distance selling in one or more European countries exceeds the new EU-wide threshold of € 10,000, VAT registration and the submission of returns will be mandatory in all countries in which goods and services are sold. Each additional Euro must also be taxed at the VAT rate of the destination country, e.g. the Italian rate.
However, if a seller has registered for the OSS, or One-Stop-Shop, the EU-wide delivery threshold no longer applies. Each individual sale must then be taxed at the country-specific VAT rates. However, VAT registrations in other EU countries are no longer necessary. The VAT is paid in the home country of the company and therefore no returns are required abroad. The local tax office then redistributes the VAT. But be careful: this rule only applies as long as there is no storage abroad. If goods are stored in another EU country, VAT registration and VAT returns are required there again.
Example: You are a seller from Germany with an annual net turnover of € 11,000 through distance sales to end consumers in France, Spain and Italy. When using the EU-wide delivery threshold, € 1,000 must be taxed at the French, Spanish and Italian VAT rates. The sales must also be declared in VAT returns there, for which VAT identification numbers are required. The situation is different when registering for the OSS. Then the entire turnover of € 11,000 has to be subject to the foreign VAT rates. However, the entire amount is paid to the German authorities, which then distribute the VAT to the different countries. No identification numbers, registrations, or returns are required there. This applies as long as there is no storage in another EU country. As soon as products are stored in warehouses there, the VAT responsibility mentioned must be fulfilled again.
Sounds complicated? The hellotax team can help and support you in navigating and fulfilling VAT obligations. We take care of your filings and registrations for VAT or the OSS. Our automation tool also helps you pay the VAT.
Frequently Asked Questions
In general, you need to file Italian VAT Returns on a quarterly basis. Additionally an annual VAT Return in the following year is required.
Quarterly VAT Returns in Italy are due at the end of the month following the reporting quarter, so usually the 30th or 31th of that month. The form used is called Comunicazione Liquidazioni Periodiche IVA.
End of the following month
Comunicazione Liquidazioni Periodiche IVA
30th of April
End of the following month
The penalties for late payments of VAT equal an interest charged on unpaid VAT 30%, while late Returns are fined up to 240%. There is also an annual interest charge of 2.5% on unpaid debt.
In order to obtain a VAT ID and start filing VAT Returns in Italy you need to fill out and submit an application with the italian tax authorities. Some other documents, such as VAT certificates also need to be translated and submitted.
In Italy, the standard VAT rate on goods and services is 22%. A reduced rate of 10% applies to some food items, pharmaceuticals, transport, cultural services, construction, energy products, alcoholic beverages in bars and cafes. Another reduced rate of 5% applies to some more food items, social services and passenger transport, while 4% applies to medical equipment, books, newspapers amongst others.
You might also need
VAT Returns in Poland
Poland is one of online sellers' favorite countries for storage and more. We can help you with the tax compliance.
VAT Returns in Austria
Joining the Amazon Pan-EU or the Amazon Central Europe Programme? Then you also need to register for VAT and file VAT returns in this country.
VAT Returns in France
A VAT registration and VAT returns are France is required when you store goods in warehouses in France. This also includes Amazon's fulfilment centres.