Legislative Decree no. 175/2014, so called “Semplificazioni fiscali” concerning tax simplification in connection with the VAT refund claims was introduced in 2014. When released, the rules concerning the simplification procedure were unclear, especially in the application for non-EU companies. A Circular Letter (i.e. no. 35/2015) issued by the Italian tax authorities, provided further clarity with respect to the simplification rules, particularly with respect to non-EU companies that wish to avail the benefits under the simplification rules. Now more details are available.
According to the Art. 13 of the above mentioned Legislative Decree it is possible to avoid the submission of a financial guarantee, provided the VAT credit included in the annual VAT return is certified by an authorised intermediary (as PwC) through the so called “visto di conformità” confirming that the VAT credit reported in the return is consistent with the VAT ledgers and said VAT ledgers are properly kept.
In order to provide the “visto di confirmità” the intermediary is obliged to carry out number of checks, required by the Italian VAT law, in order to certify that the VAT credit exists and the VAT compliance obligations are duly fulfilled and draft a check list, including the outcomes of such checks. Moreover, in addition to the “visto di conformità” also the following conditions have to be met and assessed through the issuance of a certification, attesting that:
- the shareholders’ equity has not decreased, in respect of the accounting data results of the last closed period, by more than 40% and the consistency of the real estate properties has not been reduced more than 40% due to supplies not carried out in the normal operation of the activity carried out;
- the business itself has not ceased, nor has been reduced as a result of transfers of companies or going concern;
- in the year previous to the VAT refund claim, shares or quotes of the same company for an amount higher than 50% of the share capital have not been sold (in case of a joint-stock company not listed on a regulated markets);
- social security and welfare payments have been carried out.
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In the main, according to the Circular Letter and to an informal meeting we had with an Officer of the Italian tax authorities of Milan, in case a non-EU company, registered in Italy through a fiscal representative and established in a Country with which Italy signed an International Convention for the avoidance of the double taxation, would like to benefit of the simplification, in addition to the “visto di conformità” has to provide, under its own responsibility and through the fiscal representative, the above mentioned certification attesting the relevant conditions (please refer to points 1., 2., 3., and 4. above).
In case of any questions, please do not hesitate to contact my colleague Luca Lavazza at: luca. firstname.lastname@example.org or +39 02 916 05701