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Italian VAT credits lost for non-trading companies

  • VAT
  • 22 July 2014 | Richard Asquith

Italian VAT credits lost for non-trading companies

The Italian VAT authorities have confirmed that VAT credits due to non-operating businesses, or companies making long term VAT losses (and credits), are non-refundable.

It has been a long term problem for businesses operating in Italy, especially non-residents, to reclaim their excess VAT paid.  Unlike most other EU member states, companies have to wait for the Italian annual return to start the procedure for a reclaim.  Even then, the payment may take many months, perhaps even years.

The Italian authorities have now confirmed that such credits for loss-making entities may not even be offset against any other taxes due.


VP Global Indirect Tax
Richard Asquith
VP Global Indirect Tax Richard Asquith
Richard Asquith is VP Global Indirect Tax at Avalara, helping businesses understand their compliance obligations as they grow globally. He is part of the European leadership team which this year won International Tax Review's Tax Technology Firm of the Year. Richard qualified as an accountant with KPMG in the UK, and went on to work in Hungary, Russia and France with EY.