In the past decade, Italy has devoted many efforts to closing its VAT gap, the difference between expected and actual VAT revenue, which is among the biggest in Europe. Since 2014, the Italian government has started progressively rolling out its e-invoicing system, FatturaPA, in which invoices are submitted over its electronic invoicing platform, Sistema di Interscambio (SDI). The initial implementation of the system in 2014 concerned B2G (business-to-government) transactions, which needed to be invoiced through the FatturaPA scheme. To this, the tax office added B2B and B2C transactions in 2019, which also became subject to mandatory electronic invoicing. Today, the Italian e-invoicing system continues to evolve.
In December 2020, the government announced the new Italian budget law. In it, changes to the rules for the e-invoicing of some B2B transactions are outlined; the changes will be effective from January 2022.
What’s Changing for B2B Transactions?
The new rules concern B2B cross-border transactions, i.e. transactions with businesses that aren’t tax residents of Italy and that don’t have an Italian VAT number. According to them, Italian tax residents need to provide detailed information about transactions with foreign companies in the SDI system. They must provide this information in an XML format. As a result, Italian businesses will no longer have the obligation to file a Sales and purchases return, known as Esterometro, for transactions with foreign entities: everything will be handled through the SDI portal. This effectively means that Italy will abolish the Esterometro from 2022.
Italian businesses purchasing goods or services from foreign suppliers will need to file the respective e-invoices in the SDI system. They need to do this no later than the 15th of the month following the month of the reception of the invoice, or the month in which the transaction took place, VAT-wise. For goods, this is typically the date of delivery, while for services, it’s the payment date.
Italian companies issuing electronic invoices to foreign businesses must file these to the SDI portal no later than 12 days after the transaction date (again, from a VAT perspective). This deadline is standard for submitting e-invoices in Italy, and Italian businesses are already familiar with it.
What are the Penalties in Case of Non-Compliance?
If a company fails to comply with these rules, a maximum fine of 400 EUR per month applies (2 EUR per invoice). If they file all invoices and related information within 15 days of the deadline, they’ll only have to pay 50% of the penalty.
To avoid sanctions, if you’re operating in Italy and have an Italian tax residency, it’s essential to keep up to date with the latest changes in Italian tax law, and be able to adapt to the new rules.
Fonoa Will Help You to Operate Compliantly in Italy
Thanks to our direct integration with Sistema di Interscambio (SdI), the Italian Revenue Agency, we can help you automate your invoicing processes in Italy. Our solution in Italy supports the issuance of both electronic invoices (Fattura Elettronica) and electronic receipts (Scontrino Elettronico). In that way, it will help you ensure that your business is safe from the high fines for invoicing non-compliance.
Our solution is 'plug&play', and doesn't require weeks of integration. Reach out to us and we will help you to stay compliant in Italy.