VAT in Italy: The Complete Compliance Guide

Doing business with Italian companies requires a solid understanding of the local VAT system. Whether you’re buying or selling goods and services, or incurring business expenses on Italian territory, the question of Italian VAT rates and the obligations that come with them, quickly becomes central to your operations.

What rules apply? How does the Italian VAT refund process work? What rates apply to which goods and services? And what steps do you need to take to recover charged VAT?

VAT Rates in Italy

In Italy, VAT (IVA) applies to most goods and services. The consumer bears the final cost — businesses act as intermediaries, collecting VAT on sales, deducting it on business purchases, and remitting the balance to the State.

Italy applies four main rates, depending on the nature of the goods or services supplied. Correctly identifying the applicable rate is essential for invoicing, pricing, and VAT recovery.

Standard VAT Rate: 22%

The standard rate of 22% applies to the majority of goods and services. It’s the default rate unless a specific reduced or exempt category applies.

Reduced Rate: 10%

The 10% reduced rate applies to:

• Hotel accommodation and short-term rentals;
• Restaurant and catering services;
• Passenger transport;
• Electricity and gas supplies for household use;
• Certain food products;
• Building renovation works;
• Certain medicines not on reimbursable lists.

Reduced Rate: 5%

The 5% rate applies to goods and services of a social or essential nature, including:

• Certain specific food products;
• Social, health, and welfare services;
• Infant food preparations;
• Feminine hygiene products;
• Child car seats.

Super-Reduced Rate: 4%

The 4% super-reduced rate applies to essential categories:

• Basic foodstuffs and certain agricultural products;
• Books, newspapers, and periodicals (including e-books);
• TV licences;
• Medical devices for people with disabilities;
• Eligible first-time housing purchases.

Zero Rate: 0%

Exports of goods outside the EU and intra-Community supplies to VAT-registered customers in other Member States are zero-rated. Zero-rated transactions must still be reported on VAT returns, and related input VAT can be recovered.

VAT Exemptions

Certain activities are exempt from VAT in Italy, including healthcare and medical services, education and training, insurance and financial services, charitable fundraising events, and long-term residential lettings.

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How to Calculate Italian VAT

From a net price to a gross price:

Gross price = Net price × (1 + VAT rate)

From a gross price to a net price:

Net price = Gross price ÷ (1 + VAT rate)

Who Must Register for VAT in Italy?

There is no VAT registration threshold in Italy : any business carrying out taxable activities on Italian territory must register for VAT from the first transaction, regardless of turnover.

Situations that typically trigger Italian VAT registration include:

• Selling goods already in Italy (from local stock);
• Importing goods into Italy followed by local sales;
• B2C distance sales above the EU-wide €10,000 threshold (without using OSS);
• Certain services performed in Italy or supplied to Italian customers;
• E-commerce transactions to Italian final consumers;
• Storing stock or consignment goods in Italy.

💡 Small business exception: a flat-rate scheme (regime forfettario) is available to self-employed individuals with annual revenues not exceeding €85,000. Under this scheme, no VAT is charged on sales and no input VAT can be recovered.

How to Obtain an Italian VAT Number

To obtain an Italian VAT number (Partita IVA — an 11-digit code), businesses must file a Declaration of commencement of activity with the Agenzia delle Entrate:

• EU-established businesses: file Form ANR/3 directly with the Operating Centre in Pescara. Direct registration is available without the need for a fiscal representative.
• Non-EU businesses: must generally appoint a fiscal representative, who files on their behalf using Form AA9/12 (sole traders) or Form AA7/10 (entities).
• All registrations must include the ATECO 2007 economic activity code; this code must accurately reflect the actual taxable activity in Italy (import, local resale, e-commerce, etc.). An incorrect ATECO code can create inconsistency with future VAT returns.

📅 Average processing time: approximately 1 month. Once received, the VAT number must be registered in VIES for intra-Community transactions.

Filing Obligations in Italy

Filing Frequency and Deadlines

💡 Quarterly payers tip: a surcharge of 1% applies on quarterly payments. To avoid this, some businesses choose to calculate and pay monthly even when quarterly filing is permitted.

VAT payments must be made using Form F24, submitted electronically via the Agenzia delle Entrate’s platforms (Entratel/Fisconline) or authorized banks. Non-established businesses can pay via SWIFT/TARGET without an Italian bank account.

Intrastat : 2026 Update

Processing Times

• ~6 months from filing to processing;
• Payment within 10 days of approval;
• Late interest applies from 180 days if the administration delays reimbursement;
• Incomplete applications will trigger a request for additional documents.

Tax-Free Shopping in Italy

Non-EU residents can reclaim VAT on purchases in Italy. As of 1 February 2024, the minimum spend threshold was lowered from €154.95 to €70.01 at a single tax-free retailer on the same day. The refund is processed at airport refund booths or via a refund company.

Italian VAT Glossary

FAQ : VAT in Italy