Italy Tax Agency Clarifies VAT Refunds for Property Rental Transactions by Spanish Companies

The Italian Revenue Agency Dec. 24 issued Letter No. 319/2025, clarifying VAT refunds for property rental transactions by Spanish companies. The taxpayer, a Spanish tax resident company, acquired an industrial building and a residential property, intending to rent them to companies and individuals. The taxpayer sought clarification on the VAT refund process, given that the rental of the industrial building to companies was subject to VAT, while the rental of the residential property was exempt from VAT. Upon review, the Tax Agency clarified that: 1) the VAT obligations for the exempt residential lease were fulfilled through the Italian VAT identification ...