Italy: VAT inward processing relief for intra-EU goods

Italy: VAT inward processing relief for intra-EU goods

A law that introduces changes to the Italian value added tax (VAT) provisions—specifically concerning “inward processing relief” that is available for certain intra-EU transactions—was recently published in the Italian official gazette, and will be effective 18 August 2015.

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Under the new measures, the movement of goods from one EU Member State into Italy will be disregarded only if the goods, after having been processed or having value added in Italy, are returned to the taxable person in the EU Member State—the goods must be returned to the party from which the goods were initially dispatched or transported.


Similarly, the movement of goods from Italy to another EU Member State will be disregarded only if the goods, after having been processed or having value added in that other country, are returned to the same person in Italy.


Non-Italian taxable persons, therefore, need to complete a VAT registration in Italy, unless the goods will be returned to that person after having been processed in Italy.


Read an August 2015 report [PDF 190 KB] prepared by the KPMG member firm in Italy: European Bill 2014 (Law 115/15) – New Italian VAT measures

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