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The Italian tax authorities, in Ruling No. 214 (August 2025), confirmed that transfer pricing adjustments under the TNMM may trigger VAT when directly linked to specific supplies, aligning with EU-level interpretations and CJEU guidance.
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Supporting documentation, including affected invoices and detailed adjustment breakdowns, was crucial in establishing VAT relevance, as the adjustments were treated as direct revisions of transaction values rather than broad year-end settlements.
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Multinational groups should proactively review contracts, document links between adjustments and supplies, align invoicing/accounting with VAT rules, and seek rulings where needed, as EU tax authorities intensify scrutiny of intercompany transfer pricing adjustments.
Source: www.internationaltaxreview.com
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