Stricter limits to VAT credit offset and VAT deductibility

Alessandro Grassetto, partner at Bernoni Grant Thornton and coordinator of the Commission for studies on domestic tax of Roll of Chartered Accountants in Padua, contributed to the analysis of the issues concerning the new limits to the offset of VAT credit and the VAT deduction on purchase invoices, as well as to the drawing up of this article.

As it is known, following the coming into force of Law Decree n. 50/2017 on 24 April 2017, many new rules have been introduced concerning the application of the certification of conformity, the limits to the offset of tax credits, the filing procedure of F24 forms and the VAT deduction on purchase invoices.

Therefore, in order to offset VAT credits exceeding 5,000 Euros against debts relevant to different taxes, a certification of conformity must be added to the tax return from which such credits derive. In fact, the limit beyond which VAT credits (excluding quarterly ones and those offset with VAT debts) can be offset only by adding a certification of conformity on the tax return from which such credits derive (or, alternatively, through a signature by the statutory auditors) has been lowered from 15,000 to 5,000 Euros.

On the other hand, nothing has changed as concerns VAT refunds, as no certification of conformity/guarantee is requested for credits not exceeding 30,000 Euros (new limit in force since 1/01/2017, introduced by Law Decree no. 193/2016 and turned into Law no. 225/2016).

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