Italy Tax Agency Clarifies VAT Credit Ceiling Transfers in Reorganizations

The Italian Revenue Agency Aug. 4 issued Letter No. 200/2025, clarifying VAT credit ceiling transfers in reorganizations. The taxpayer, an Italian company, acquired a company’s production branch from an English company in a reorganization. The taxpayer inquired whether it could use the VAT credit ceiling that the production branch accrued. The Tax Agency clarified that the taxpayer couldn’t use the ceiling because: 1) the earlier transfer contract between the production branch and the English company didn’t expressly mention the ceiling, and the ceiling’s transfer wasn’t communicated to the VAT office within 30 days; 2) the English company wasn’t VAT-registered in ...