New provisions have been entered into force by the EU Court of Justice, regulating how to recover the VAT wrongly charged to the buyer by the supplier.

The new rules have a positive impact also with respect to the penalties applicable to the customer, recently commented here.

According to the new provisions, the buyer has the right to deduct “excess VAT” applied by the supplier.  

The concept of “excess VAT” should include both cases where the supplier has applied a rate higher than the correct one, and cases of undue tax tout court (i.e. exempt, non-taxable and excluded transactions). This interpretation is consistent with the legislator's intention to simplify the procedure for deducting incorrect VAT and to give certainty to the matter.  

In addition to the deduction of VAT, a fixed penalty of between €250 and €10,000 is now applicable.

The consequences of sanctions are therefore mitigated: in fact, in the previous regulatory framework, the sanction for undue deduction (90%) plus the sanction for the unfaithful tax return (from 90% to 180%) were due.  

The new rules allow for deduction, with the imposition of a fixed rather than proportional penalty, provided that the following requirements are met at the same time:

  •  the tax charged to a greater extent than the actual amount;
  • tax unduly paid by the supplier;
  • absence of a context of tax fraud.

 These provisions also apply to cases relating to previous years, for the benefit of any outstanding disputes.