VAT Deductibility During Company Liquidation: Recent Guidance from the Italian Revenue Agency

• The Italian Revenue Agency clarified that VAT deduction is allowed during company liquidation if expenses are strictly related to the liquidation process.
• This applies even if the company previously carried out VAT-exempt activities.
• The principle is based on the neutrality of VAT as per EU Directive 2006/112/CE.
• Legal and professional fees incurred for tax disputes and credit recovery during liquidation can be eligible for VAT deduction.
• The liquidation phase is considered distinct from the previous VAT-exempt business activity.

Source: commercialistatelematico.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.

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