The European Council Directive 2000/65/EC allows the VAT direct registration for any European based trading company wishing to sell products or services in a foreign EU country to individuals and other private entities.
This service is particularly useful for companies wishing to sell on e-commerce platforms across Europe.
The VAT direct registration allows the foreign entity to avoid a local Permanent Establishment and any income tax in the local country.
Who can apply for the direct registration?
Any trading entity identified for VAT purposes in a EU country can apply for direct registration in Italy.
Entities incorporated in non-EU countries cannot opt for the VAT direct registration, yet they can appoint a fiscal representative dealing with all tax matters.
How does the process work?
The VAT direct registration process requires a paper based enquiry to the Italian tax office; upon meeting the specific criteria, the tax office will issue the Italian VAT code and the entity can start trading in Italy.
What happens next?
Any trading company in Italy has to comply to local legislation for invoicing, VAT assessment, VAT payments, annual and quarterly return, VAT registrar bookkeeping etc.
If you need more information about the VAT system in Italy, this post gives a broad overview.
Failure to comply with the Italian VAT laws exposes the company to penalties up to 240% of the VAT liability!
How can we help?
Accounting Bolla is fully licensed to operate in the Italian jurisdiction, we have a wide expertise in VAT direct registration helping our clients with:
After moving back to Italy from the United States in 2013, I realized how much an accounting and tax firm was needed to help expats living in Italy to comply with the local tax regulations.