New thresholds for VAT payments’ frequency in Italy

Italy increased the turnover thresholds for VAT payment periods starting in 2023.

Italy increased the turnover thresholds determining the VAT payment periods. The changes increased turnover to EUR 500,000 for supplies of services instead of EUR 400,000 and for supplies of goods to EUR 800,000 instead of EUR 700,000.

VAT returns are always submitted quarterly in Italy. However, VAT payments can be made on a monthly or quarterly basis. Monthly VAT payments are considered the ordinary regime. In contrast, quarterly VAT payments are considered an option, and it comes together with a 1% interest increase that must be included in the VAT payment.

When the previous year’s annual turnover is below the turnover thresholds of EUR 500,000 for services or EUR 800,000 for supplies of goods, taxpayers can opt to make VAT payments on a quarterly basis. This option must be communicated via the Annual VAT return of the year when the option is exercised. For example, if you have not exceeded the turnover thresholds in 2022, you may start making quarterly VAT payments from January 2023, and you need to notify this option in the Annual VAT return 2023.

Once communicated, the quarterly VAT payments will apply until: a) the taxpayer is above the turnover thresholds indicated, or b) revokes this option by communicating this on the Annual VAT return.

Additionally, some Italian established taxpayers are automatically assigned to quarterly VAT payments and without the requirement of paying the 1% interest increase. These correspond to the businesses involved in the following economic activities:

  • fuel distributors
  • road haulers for third parties
  • operators of services to the public
  • arts and health professions.

Find here more information about Italian VAT returns.

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