Italian Revenue Agency Clarifies VAT Exemption for BNPL Payment Institution’s Merchant Service Fees

• The Italian Revenue Agency issued a letter on June 10, 2025, about VAT treatment for a payment institution in the BNPL sector.
• The institution allows consumers to buy goods or services and defer payments while merchants receive immediate credit.
• The institution asked if the fee for services to merchants starting in 2025 would be subject to the 22 percent VAT rate.
• They also inquired if the acquiring service should be invoiced separately and exempt from VAT.
• The Tax Agency clarified that the acquiring service is not ancillary.
• The specified fee must be invoiced under the VAT exemption regime.

Source: news.bloombergtax.com

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.