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Invoicing Solutions in Italy

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An invoice is an essential part of all business transactions. This document can serve as a receipt, an estimate of sale, a delayed payment notice, or even a payment amendment.

With the development of information technology, invoices have transitioned to adapt to current trends. E-invoicing is becoming the norm, while paper invoices are becoming obsolete, and transactions can be completed over the internet.

Like most other countries, doing business in Italy requires the use of invoices. As a member of the European Union (EU), Italy has enacted laws that require invoices to adhere to the standard that the EU has established.

 

Types of Invoices in Italy

 

Since 2018, Italy has transitioned from the use of written invoices to using e-invoices. This was done to comply with regulations set by the EU. With this, the exchange of e-invoices has become mandatory for both business-to-business and business-to-government transactions.

With Italy adopting the EU’s e-invoicing laws, e-invoicing is the most common type of invoice that sees day-to-day use.

 

E-invoicing in Italy

 

An e-invoice is a document that is exchanged between a buyer and seller through digital means. The Italian government established a processing portal, called Sistema di Interscambio, to facilitate the exchange of e-invoices. This system automatically screens invoices to make sure it follows the proper format.

 

There are several ways to submit invoices to the system, namely:

 

  • Certified Electronic Mail
  • Through the Revenue Agency Website
  • The SDICoop web service
  • The SDI FTP file transfer protocol

 

The most common types of invoices exchanged in Italy are the following:

 

  • A Past Due Invoice – Indicates a delay in payment
  • Pro Forma Invoice or Pre-Invoice – Dictates the type of work to be done and an estimated total cost.
  • Interim Invoice – An invoice sent in regular intervals to break up costs of big projects.
  • Sales Invoice – A request for payment when goods or services are exchanged between buyer and seller.

 

Requirements of an Invoice in Italy

 

For the Italian government to consider an invoice a valid document, it needs to contain the following details:

 

  • Date of when the invoice was issued
  • A unique invoice number
  • The VAT number of the seller
  • The fiscal representative details of the seller if applicable
  • The complete business address of the seller
  • The full address of the buyer
  • A complete description of the goods and/or services to be exchanged
  • The quantity of goods and/or services
  • The net taxable value of the goods and/or services
  • The VAT rate(s) to be applied
  • A reference to an applicable law where VAT can be removed (if applicable)
  • The gross value of the goods and/or services

 

Furthermore, since 2019, Italy has added more stringent requirements for e-invoices. E-invoices are not considered valid if they are sent in these formats:

  • A PDF file
  • Invoice images such as .jpeg and .png files
  • Unstructured HTML files
  • Scanned paper invoices
  • Paper invoices sent via fax machines

 

What Should be Included in an Invoice

 

To adhere to the strict invoice requirements of Italy, when a buyer and a seller exchange goods or services, a sales invoice needs to contain the following information:

 

  • The business logo of the seller
  • The business name of the seller
  • The business address of the seller
  • The contact details of the seller
  • A unique invoice number
  • The date of when the invoice was issued
  • The due date of the payment
  • The billing address of the buyer
  • A description of the goods and/or services to be exchanged
  • The number of goods and/or services
  • The gross value of the exchanged goods/services
  • The total VAT amount of the goods/services

 

For invoices that are valued from €400 and under, a simplified invoice can be used, which have fewer requirements:

 

  • The invoice date
  • The invoice number
  • The full name, address, and legal details of the seller and buyer
  • The seller’s VAT number
  • The buyer’s VAT number
  • The gross value due

 

The Benefits of Using Externalized Invoicing

 

With globalization and the advent of the digital age, the exchange of goods and services on an international stage has become easier and more common. In turn, e-invoicing has taken over its traditional written counterpart as the global standard. This, however, presents a new challenge, as businesses need to learn the laws of multiple countries when conducting international trade.

To address these issues, externalized invoicing solutions have risen to prominence. With the use of an externalized invoicing partner, your company can gain a competitive edge.

Here are just some of the benefits of using externalized invoicing companies:

 

  • Time and Money Saver
    • Eliminate the need for an accounts payable department.
    • Invoices made through a partner will be handled by specialists which will guarantee that details are concise and accurate.
    • Partners will ensure that all payments will be made on time to avoid penalties.
  • Organized Bookkeeping
    • External invoice companies will keep track of all the transactions your company conducts through their services. This will ensure that you have a precise and accurate record of all the payments you have made and if any are still due.
  • Ease of Payment
    • A professional external invoice partner will have access to different currencies, making international transactions possible.
    • These companies will also have in-depth knowledge of the laws and requirements of different countries.

 

Partner with INS Global for Your Invoicing Solutions in Italy

 

Expanding your business in Italy? At INS Global, we have more than 15 years of experience in helping companies across various industries in invoicing, payroll and tax, and other PEO services. Our team of experts will ensure that your business is fully compliant with local laws and regulations. Get in touch to know more!

 

 

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