Economic Substance Prevails Over Form in VAT Invoicing

In IVA: la sostanza economica dell’operazione prevale sulla forma nella fatturazione, published on Commercialista Telematico (10 July 2026), Claudio Sabbatini explains that EU VAT law attaches importance to the economic substance of a transaction, not merely the formal transfer of ownership. For a supply of goods to exist for VAT purposes, what matters—per the CJEU—is the transfer of the power to dispose of the goods as owner, which does not always coincide with the civil‑law transfer of title. [commercial…matico.com]

The distinction is especially relevant to intra‑group transactions, corporate reorganisations and international distribution chains. The article analyses a case where Italian company A, part of international group X, “sells” its standard warehouse stock to foreign parent X (VAT‑identified in Italy but without a fixed establishment) to centralise inventory management—yet the goods physically remain in Italy. The same applies to “special” made‑to‑order products, which are first sold by A to X and then resold back to A, with invoicing including a mark‑up. [commercial…matico.com]

Because the goods do not leave Italian territory on sale, A charges Italian VAT. The article examines the resulting implications for invoicing obligations, the reverse charge, and VAT warehousing (deposito IVA), and the CJEU principles distinguishing the VAT concept of a supply from the civil‑law notion—reinforcing that where the power of disposal has not genuinely passed, the formal transaction structure may not determine the VAT treatment. This substance‑over‑form theme echoes broader CJEU jurisprudence on Article 138 intra‑Community supplies and the right to deduct. [commercial…matico.com], [fiscooggi.it]