Refund of foreign VAT credits - submit applications for 2023 by Monday, 30 September 2024 – note the changes for the United Kingdom!
Bolzano, 02.09.2024
By Monday, 30 September 2024, businesses and self-employed professionals may once again submit applications for the refund of the value added tax incurred in 2023 in other EU countries. The relevant provisions have not changed compared with previous years. Nevertheless, a brief summary is given here, because the refund is repeatedly forgotten:
Submit refund applications in Italy
For businesses and self-employed professionals within the EU, the rule is that they must submit the input VAT refund application for the supplies of goods and services acquired in other EU Member States to their own tax administration in each case. For Italian businesses this means, within the meaning of Art. 38-bis2 of the VAT Act: all applications for VAT refunds for the year 2023 from other EU countries are to be submitted solely to the Italian tax administration, namely to the office in Pescara (Centro operativo di Pescara).
Transmission by electronic means
All applications must be transmitted via an electronic portal by means of „Entratel“ or „Fisconline“, or through the self-employed professionals authorised to transmit tax returns electronically. The relevant service is available on the website of the Italian Revenue Agency under the heading „Businesses“ under „Rimborsi Iva Ue soggetti residenti“. In order to be able to use the service directly, however, a separate registration is required beforehand.
Deadline
The final date for the refund application for the year 2023 is 30 September 2024.
Refund period
In principle, the refund application may be submitted annually; most countries, however, also allow shorter refund periods (as a rule quarters). It is as a rule advisable to make use of these shorter periods, especially since errors in applications already submitted may only be corrected within the aforementioned deadline of 30 September. Where, therefore, an application has been submitted incorrectly, corrected returns may still be submitted in each case by 30 September; after that deadline a correction is only permitted to a limited extent.
Processing and refund
The processing office in Italy is the tax service centre in Pescara. There the applications submitted by electronic transmission are collected and then forwarded to the competent authorities of the other EU countries. The payment of the credits themselves is, however, not made by the Italian tax authorities but by the respective foreign tax administration.
Finally, it should be pointed out that by 30 September 2024 entrepreneurs and self-employed professionals from other EU countries, or from countries with which a relevant bilateral agreement with Italy exists (Israel, Norway and Switzerland), may also apply for the refund of the input VAT borne in Italy in the previous year.
And conversely, Italian entrepreneurs and self-employed professionals may apply in Israel, Norway and Switzerland within the aforementioned deadline for the VAT refund for 2023 in accordance with the respective local provisions.
United Kingdom:
And in this connection it should be recalled that, on the basis of an exchange of diplomatic notes between Rome and London last winter, it has finally been clarified that by 30 September 2024 refund applications may also once again be submitted for the value added tax in the United Kingdom, which, as is known, has no longer been a member of the EU since 2021 as a result of Brexit.
It is interesting that the above-mentioned exchange of notes provides for a refund with retroactive effect from 2021; it has not, however, been unambiguously clarified whether this retroactive application means that the applications submitted in the previous years (in each case by 30 September of the following year) are accepted retroactively, or whether it amounts to an extension of the deadline, that is to say that it is now still possible to apply for the refund of the turnover tax borne in the United Kingdom in the years 2021 and 2022. Since, as a matter of formal law, an application would in fact not even have been possible until this year, the second interpretation must actually be preferred. In case of doubt, we recommend submitting separate applications for the previous years 2021 and 2022; at worst they will be rejected.
Please do not hesitate to contact us if you have any queries.
Yours faithfully,
Dott. Comm. Josef Vieider
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