New rules for value added tax “bad debt” relief in relation to insolvency proceedings
Guidance from the Italian tax authority provides new rules for value added tax (VAT) “bad debt” relief in relation to insolvency proceedings.
The guidance—Circular no. 20/2021 (29 December 2021)—also reflects a change from prior guidelines concerning how to recover VAT (if charged in past invoices) by means of credit notes.
Under the new rules (as provided by Circular no. 20/2021), VAT can be recovered only between the date of issuance of the credit note and the deadline for filing the VAT return for the year in which the credit note is issued.
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