- Permutative operations for VAT are characterized by the nature of the consideration, which is not a payment in cash but the transfer of a good or the provision of a service.
- Each transaction is subject to its own rules and must be examined individually.
- The Italian Revenue Agency has confirmed this in response to an inquiry.
- In the specific case examined, a company received a contribution from a municipality for the construction of a school building.
- This contribution is considered a consideration for the obligations assumed by the company and, for the part financed by the municipality through the transfer of land, it is considered a barter (service provision versus transfer of goods).
- The transfer of an immovable property is considered a payment in kind subject to VAT separately from the related service, based on the normal value of the transferred goods.
- In this case, since the barter occurs between two VAT-registered entities, VAT is applied according to the respective rates for each operation.
- For service provisions, VAT becomes due at the time of payment, unless the company has issued an invoice in advance under Article 6 of the DPR 633/72.
Source: eutekne.info
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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