VAT Refund Italy : 6 Months Deadline

From today – June 21st 2012 – foreign companies operating in Italy should apply their VAT refund in the 6 months following the end of the fiscal year (usually December 31st). In short, the VAT on invoices issued during 2012 will be refunded only if the application is filed before June 30th 2013 (6 months after December 31st).

The decision comes directly from an inquiry of the Italian Supreme Court “Corte di Cassazione” to the European Court of Justice.

The VAT refund could be a long process in Italy. I have personally tested the process both as a lawyer, being involved in Tax Litigation, and as an entrepreneur. This new deadline isn’t particularly strict. Six months are more than enough to find your invoices and file an application, and the term is in line with the EU Law (if you are interested it’s the Directive 79/1072/CEE, articles 7, paragraph 1).

There is a far more important aspect to regulate, and it’s the speed of the refund, or – better to say – the complete lack of speed. In fact being refunded in Italy can take 6-12 months. Sure we lawyers can go into Tax Litigation and win, but in the current economy companies need cash now more than interests later. This is what we would like to see.

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