Compensation of VAT credit for non-“operational” companies – article 30 of law 724/1994

• The company [ALFA] is seeking clarification on the use of VAT credit offset for companies that have not passed the “operational test” according to the law.
• The company received a tax assessment notice for IRAP taxes and a refund of VAT for 2009, based on the grounds of non-operability.
• The company filed a lawsuit against the tax office, but it was rejected in the first instance.
• The case was referred to a higher court for lack of necessary joint litigation with the partner.
• The higher court ordered the case to be sent back to the lower court for further proceedings.
• The lower court ruled in favor of the company and ordered the tax office to reimburse the litigation expenses.
• The tax office appealed the decision, but it was rejected.
• The tax office then appealed to the Supreme Court, which ruled in favor of the tax office.
• The company was requested to repay the VAT and pay the IRAP taxes with interest and penalties.
• The company requested a payment plan, which was granted by the tax collection agency.
• The company’s operational status for the years 2009, 2010, and 2011 was as follows: 2009 and 2010 were considered non-operational, while 2011 was exempt from the law’s provisions for companies that meet certain criteria.
• The company’s VAT credit for 2009, once repaid in installments, is not considered lost.

Source: agenziaentrate.gov.it

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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