- The right to claim an VAT refund for excess deductible VAT arises in cases of “cessation of activity” under Italian VAT law, with no minimum amount required.
- The law does not clearly define cessation, but the Italian Supreme Court says it means the actual end of economic activity and the link between taxable transactions and the business.
- A mere interruption or prolonged inactivity does not equal cessation if the business could still resume or make taxable transactions, such as asset sales during liquidation.
- In a 2026 case, the Court denied refund eligibility because the company’s activity had not truly ceased in substance, despite inactivity and liquidation procedures.
- EU case law supports a factual assessment: refund is allowed only when no further VAT-taxable operations will be carried out.
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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