Prepared by Davide Accorsi, Amélie Mammone and Cristina Mosca
With the answer to Ruling No. 442/2022 dated 2nd September 2022, the Italian Tax Authorities provide clarifications on a case submitted by a taxpayer on the VAT registration in Italy through the appointment of a VAT representative according to Article 1, paragraph 4 of the Presidential Decree No. 441/1997.
In the case at hand, the applicant asked the Italian tax authorities to clarify the meaning to be attributed to one of the methods of appointment of the VAT representative provided by Article 1, paragraph 4 of the Presidential Decree No. 441/1997. More in detail, the question is related to the meaning of the “letter recorded in a specific register kept at the competent VAT office“.
First of all, the Italian Tax Authorities recall that a non-resident taxable person without a permanent establishment in Italy, who carries out taxable operations in the Italian territory, can register for VAT purposes in our country either directly through the direct identification (a procedure applicable only to taxable persons resident in the European Union and Great Britain, as also specified in the tax practice document under exam) or by appointing a VAT representative (without changing the status of non-resident operator).
With reference to the second option, the Italian Tax Authorities list the official “means” through which the appointment of the tax representative can take place. Specifically, under Article 1, paragraph 4 of Presidential Decree No. 441/1997 (which replaced Article 53 of the Presidential Decree No. 633/1972) “the relationship of representation results from a public deed, from a registered written private deed, from a letter recorded, prior to the date on which the transfer of the goods took place, in the specific register kept at the competent VAT office in relation to the fiscal domicile of the representative or of the represented person, or from a communication made to the VAT office in the manner provided for in Article 35 of Presidential Decree No. 633 of 1972, provided that it is dated prior to the transfer of the goods. […]“. In addition to these documents, a deed notarized by a foreign public notary adhering to the Hague Convention of 5th October 1961 with the “Apostille” stamp or legalized by the general consul of Italy in the foreign state (Resolution no. 550570 of 26th January 1990) providing such relationship of representation are admitted.
Once recalled the official means through which the appointment of the tax representative can be carried out, the Italian Tax Authorities clarify the meaning to be attributed to the above-mentioned “letter” of appointment. This last document can be drafted on plain paper, it must be submitted to the Revenue Office together (and simultaneously) with the request of attribution of the VAT number, and it must contain the data identifying the represented foreign company and the Italian VAT representative. The person empowered to sign on behalf of the foreign company (after having given evidence of the relevant signature powers) and the one possibly able to sign on behalf of the Italian VAT representative, after identifying themselves, must sign such letter in front of the tax officer. After having carried out the necessary checks, the Office records the letter of appointment and, at the same time, it releases proper documentation certifying the recording of such a letter on the so-called “Modello VI” register.
In conclusion, the Italian Tax Authorities highlight that, in the lack of one of the above-mentioned official acts, the omitted appointment of a VAT representative occurs and not a late communication to the Office of the VAT representative appointment.
Given above, it is worth noting that the above-described interpretation seems not to be aligned with the prevailing jurisprudence of Italian Supreme Court, ruling the principle that “the appointment, pursuant to Article 17, of the tax representative in Italy for VAT purposes of a nonresident person may result not only from the forms provided by Article 53, of the same Presidential Decree, but also from the communication to the tax office pursuant to Article 35 (declaration of start of activity)” (see judgement of the Italian Supreme Court No. 5400/2015, which recalls the previous judgements No. 5558/2005 and No. 11696/2007).
In fact, the Italian Supreme Court disregards the view that the VAT representative must justify the mandate with a public deed or a registered private deed as, in its view, Article 1, paragraph 4, of Presidential Decree no. 441/1997 provides the legitimacy to act on the basis of the mere communication to the Tax Office of the beginning of the tax representation relationship (see the judgement of the Supreme Court No. 23754/2013 and the Supreme Court order No. 12464/2019). “Therefore […] the rigid documentary formalism, applied by the Tax Authorities and the judges of first instance, should be overcome, as not ground by the meaning and the rationale of the indicated provision, and the declaration of start/change of activity (form AA7/6) should be considered sufficient ” (see the judgement of the Italian Supreme Court No. 5400/2015). This, also “in view of the principle, affirmed by constant jurisprudence of the Court (e.g., judgement No. 11455/2001), of the relevance of the taxpayers’ conclusive behavior for the purposes of the application of special regimes, behaviors that do not require the fulfillment of specific formalities (see judgement no. N0421/ 2014) (see also ex multis the above-mentioned judgement of the Italian Supreme Court No. 5400/2015)”.
Last, the Italian Tax Authorities answer the other two questions asked by the applicant company by clarifying, among the others, that:
- a taxable person (resident in Italy) can assume the role of VAT representative with reference to various foreign taxable persons, by using a different VAT number for each represented person and, for this purpose, the VAT representative must keep each VAT position (including its own one) separately, by means of separate VAT bookkeeping;
- code “1” i.e. “declaration of starting of activity with attribution of fiscal code” must be crossed in the communication of starting of activity; a specific fiscal code will be attributed to the subject, and it is different from the one belonging to the VAT representative. This fiscal code, coinciding with the VAT number, will remain unchanged even in case of change of the fiscal domicile, until the cessation of the activity.
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