Starting from the 1st of January 2019 it will become mandatory to use electronic invoicing for the supplies of goods and services carried out by residents, established or registered companies in the Italian territory with no possibility to postpone or gradually start to use e-invoicing in function of business volume.
The Italian Government consider that many companies are not prepared to adopt this new mandatory regime and is currently working on some simplifications that will be introduced in the Budget Law, Legge di Bilancio 2019.
News relating to simplifying the e-invoicing should be divided in two; the first concerns the sanctions in relation to the starting period where the sanctions should be reduced or not applicable in case of a delay in issuing of the e-invoice. In this way, it will not compromise the settled terms of VAT return, while the second measurement should concern the extension of the period for issuing and transmitting invoices from the Interchange system (SDI)
The need to introduce simplifications to the e-invoicing arises from some current features in the new obligations of the certification of the invoices, in particular:
- The e-invoice has to be issued before 24:00 of the same day in which the operation is carried out, unless the “minimum delay not sanctioned” applies. On this aspect, the Italian Tax Authority (Agenzia delle Entrate) has expressed its concern stated in the provision from the 30th of April, 2018 where they require the obligation of the coincidence between the indicated date in the file XML and the transmission of the e-invoice tolerating a minimum of delay (the significance of “minimum delay” is not yet clarified) only during the first applicable phase. We do hope that the simplifications arriving with the budget law 2019 can help companies in the management of the transmission of the electronic invoicing.
- Important to understand is that the process of the e-invoicing provides that, after the conversion of the document in XML format and by using the digital signature, the invoice will be sent to the Interchange System (SDI) of the Italian Tax Authority. In turn, the Italian Tax Authority will verify the XML document and only after a positive outcome the invoice will be available to the addressee. The verification phase of the SDI is very delicate. In case that the Interchange system will refuse the XML document a rejection receipt will be sent and the invoice will not be issued. In this case, the law regulation the e-invoicing has established that if the invoice has been created in a format different from XML or sent to the client without transitioning via the Interchange system (as it has been rejected) it will be intended as omitted with applicable sanctions as a consequence to the sender if not the sender will intervene rapidly correcting the errors and resending the invoice. While the addressee of the invoice will not be able to deduct the VAT as the document is omitted.
The verifications carried out by the Interchange system on the XML documents are as follows:
- The presence of the minimum obligatory indications provided by art. 21 or 21 bis of DPR 633/72;
- The presence of the VAT registration number in the tax register of the supplier and the one of the client (or if the document is addressed to a private consumer the social security number)
- The presence of a telematic ID number;
- The coherence of the data contained in the document, e.g. the correct indication of the VAT on the basis of the rate, or indication of the code relative to the nature of operation in which VAT should not be applied.
If, the XML document doesn’t pass the control by the Interchange system a receipt of rejection will be issued and transmitted to PEC or to the telematic channel where the SDI has received the XML document. In any case, it will be available to the transmitter in the authentication area “Consultation – Monitoring of transmitted files on the portal “Invoice and Equivalent”. To avoid sanctions, the transferor/supplier will have to correct the errors and remit again the document within five days from the date of the rejection receipt (that is effective days and not working days)
To reduce the risk of making errors related to biographical data of the client and consequently the rejection of the invoice by SDI, the transferor/supplier can find client’s data through the QR-CODE, generated through the portal “Invoices and Equivalent”, that contains elements of the client such as: social security number, VAT number, registered name and destination code, or PEC to passive taxpayers (this information is only available to those registered to the telematics ID to receive e-invoices by using the specific service provided by the Italian Tax Authority).
It is important to clarify that the e-invoicing does not apply to non-Italian entities as the EEC has only authorized Italy to use it. Furthermore, for entities identified in Italy directly or through a fiscal agent in accordance of art. 35-ter and art. 17 co.3 DPR 633/72 the following applies:
- Outstanding active operations by an entity identified in Italy (directly or indirectly through a fiscal agent) compared to an entity established in Italy is not obliged to be certified through the e-invoicing (without a prior consent) and is seen only as an option.
- Outstanding active operations by a passive entity in Italy compared to an entity identified in Italy (directly or indirectly through a fiscal agent), shall be certified through paper invoice and only with prior consent by the client it’s possible to issue an e-invoice.