VAT in Italy

VAT in Italy

Italian IVA

Value Added Tax (VAT), known as IVA (Imposta sul Valore Aggiunto) in Italy was introduced in 1972 and has integrated the rules and directives set by European Union. The Ministry of Finance oversees the entire VAT system. The current VAT rate applied in Italy is 22 percent.

Requirements

According to Italian legislation, any type of companies formed in Italy that are trading in Italy and supply taxable goods or services must follow specific steps such as registration for the Italian VAT, complete regularly the Italian VAT return and other declarations and comply with the VAT rules.

Non-resident companies that provide goods or services may be required to register with the Italian tax authorities as taxpayers. This is usually required if a company buys and sells goods within Italy and the supplier and customers are not Italian companies with VAT registration and if a company deals with provision or acceptance of intra-community suppliers, receipt of goods as acquisition from other EU States. Also sales to individual customers using the Internet are included in the list, as they are subject to the Italian distance selling restoration threshold.

VAT identification

When it comes to European Union, if your company is in Italy and you want to run your business outside Italy, you need to ask for the “VAT identification” in a few EU countries.

In September 2013 an increase of the VAT rate took place from 21 percent to 22 percent. Italy offers the possibility of VAT refund for visitors. Foreigners that visit the country may receive a refund of the VAT tax paid on goods bought for deportation. In order to proceed with the refund, the visitor must present his passport, the receipt of the goods and a proof of the deportation of the goods to an Italian VAT refund station, usually found in airports, tourist offices or international travel hubs. VAT tax refunds are different by region.

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