VAT warehouse Italy Magazzini Generali Brianza New logistic solution in order to minimize fiscal impact in import/export operations (duties + vat)

1. A GUIDE TO THE BENEFITS OF THE VAT
DEPOSIT

2. What is the VAT deposit?
The VAT deposit is
a tax system as well as a physical deposit
allowing to
release, keep and process goods
without VAT liability.
(DL 331/93 art. 50 bis)

3. Benefits
• Simplification of VAT refund and tax representation
procedures
• Reduction of the working capital
• Savings on the cost for bank interest
Interest 2.000 € Savings on money rate
VAT 20.000 € Working capital reduction
Goods 100.000 €

4. Main operations benefitting from VAT
deposit
The VAT deposit allows to simplify VAT liabilities
associated with the following operations:
1. “Import” and subsequent activities (intra-
community sale, marketing in Italy, etc…)
2. Intra-community purchasing
3. Transfer of goods in Italy by a community
operator
4. Sales to community subject
5. Sales between national operators for goods
traded at the Commodity Exchange

5. Case 1: “import”
“Import” implies the concomitant execution of two distinct operations: “release for
free circulation” and “release for home use”
– RELEASE FOR FREE CIRCULATION: non community goods become
community, through the payment of duties. Release for free circulation can also
be carried out by community or extra-community operators that have appointed
a tax representative in Italy (to be verified if required)
– RELEASE FOR HOME USE: following VAT payment at Customs, extra-
community goods become home use goods; that is, they can be sold on the
national territory.
RELEASE FOR
FREE RELEASE FOR
CIRCULATION HOME USE
(DUTIES) (VAT)
HOME
EXTRA-EU COMMUNITY
USE
GOODS GOODS
GOODS
Customs import operation

6. Case 1: “import”
Using the VAT deposit, after the release for free circulation, you can have
goods at your disposal without paying VAT at customs for the following
operations not subject to VAT (see figure in the next page):
– INTRA-COMMUNITY SALE (if the importer is not Italian
lightweight tax representation is required)
– INTRA-COMMUNITY SALE with MARKETING IN ITALY (if the
importer is not Italian but goods must be sold in Italy)
– MARKETING IN ITALY (through self-billing invoice by the Italian
importer)
– EXPORT to extra-EU country

7. Case 1: “import”
RELEASE FOR
FREE RELEASE FOR
CIRCULATION HOME USE
(DUTIES) (VAT)
HOME
EXTRA-EU COMMUNITY
USE
GOODS GOODS
GOODS
INTRA-COMMUNITY SALE (LW
TAX REPRESENTATION)
INTRA-COMMUNITY SALE and
MARKETING IN ITALY (LW TAX
REPRESENTATION)
VAT DEPOSIT
MARKETING IN
All operations indicated ITALY
in this figure don’t
require VAT payment
EXPORT

8. Case 1A: intra-community sale with
lightweight tax representation
Sale takes place between a community seller and a community
buyer, not belonging to the same member country (e.g. a Spanish
party sells to a Spanish party). Steps:
1. The seller appoints MGB as lightweight tax representative
2. The seller submits a facsimile of the sale invoice
3. MGB issues an invoice as LTR as per art. 41/50 BIS of LD
331. This invoice is the document required for withdrawal
from deposit from the point of view of tax regulation. From a
physical point of view a TD is OK
4. MGB fills in the INTRA form (on a basis to be defined
according to the cumulate VAT value)
VAT DEPOSIT
Community Community
seller Withdrawal with intra-community sale buyer

9. Case 1B: intra-community sale and
marketing in Italy with lightweight tax
representation
The sale takes place between a community seller and an ITALIAN buyer WITHIN THE TAX
DEPOSIT. The Italian buyer then takes care of withdrawal from deposit for marketing in Italy.
Steps:
1. The seller appoints MGB as lightweight tax representative
2. The seller submits a facsimile of the sale invoice
3. MGB issues an invoice as LTR as per art. 41/50 BIS of LD 331. MGB fills in the
INTRA form (on a basis to be defined according to the cumulate VAT value)
4. The ITALIAN party takes care of withdrawal from deposit through the issuing of a self-
billing invoice (we have chosen the self-billing invoice as it is simpler than the
integration of the invoice issued by MGB; also, is withdrawal from deposit determined
by community sale or by self-billing invoice as shown in the drawing??)
5. Goods are physically withdrawn from the deposit with a self-billing invoice or with a TD
issued by MGB.
6. MGB sends to the ITALIAN party both the self-billing invoice with its stamp and an
invoice issued by MGB (as it is the document certifying the ownership of goods by the
Italian party)
VAT DEPOSIT
Community inner intra- Withdrawal for
seller community sale Italian buyer marketing in Italy

10. The Lightweight Tax Representation
As we have seen, in case of intra-community sale or of intra-community sale for
marketing in Italy, the community seller must take on a lightweight tax
representation from MGB as VAT deposit holder.
This implies:
– Issuing of the intra-community sale invoice on the basis of the data
supplied by the seller
– Invoice keeping
– Filling in of the INTRA form (on a basis to be defined)
The invoice issued by MGB must specify the following data:
– VAT ID number of the represented party (that is, of the community seller)
– VAT ID number of MGB as lightweight tax representative
– VAT ID number of the community buyer
– Non-liability title (art 41/50BIS of l.d. 331/93)
– Goods quantity, value, description, etc… (as in Italian invoice)
– MGB progressive registration number

11. Case 2: intra-community purchasing
The term “intra-community purchasing” indicates the purchasing of
community goods between an Italian operator holding a VAT ID number
and an operator holding a VAT ID number within the Community, with
transfer of goods from the member country to Italy.
Even the transfer of goods to Italy to fulfil enterprise requirements is
considered as intra-community purchasing (for example in the case of a
community operator transferring spare parts to Italy).

12. Case 2: intra-community purchasing
With the VAT deposit the invoice doesn’t need to be integrated with VAT
when goods are transferred to Italy, with benefits for:
1. THE ITALIAN BUYER who needs to stock goods before reselling
them
2. THE COMMUNITY OPERATOR who needs to stock goods in Italy
before proceeding to the sale (a typical example is that of spare
parts). In this case he no longer needs to appoint a tax
representative, as withdrawal from deposit is carried out by the
Italian buyer.

13. Case 3: transfer of goods to Italy by a
community operator
With the VAT deposit a community operator, wishing to transfer
some goods to Italy for stocking or attempted sale, must not take
on a heavyweight tax representative in Italy, not even at selling
time.
Examples
– Stocking: a community operator transfers some goods to its
Italian branch to resell them
– Tenders: a community enterprise has won tender in Italy for
the manufacturing of a plant and wishes to stock in Italy the
goods and machinery to be used for the plant.
– Attempted sale: goods are released in VAT deposit with
lightweight representation and then sold without paying the
VAT

14. Case 4: sale of national goods in EU
The VAT deposit allows to meet an operating requirement often arising in case of sales
involving goods stocking.
Just consider the case of a national operator selling national goods to a community operator,
who, not having a storage area, asks to keep the goods in Italy for some time (e.g. sale of
collections in the fashion sector).
Without VAT deposit one would risk errors and penalties, as :
– The invoicing as intra-community sale (without VAT) is not correct, as the transfer of
goods (essential condition) has not taken place yet
– The invoicing with VAT may be contested by the community operator
STOCKING OF GOODS IN
NATIONAL DEPOSIT
Invoice without VAT
NATIONAL COMMUNITY
OP. OP.
Invoice with VAT

15. Case 4: sale of national goods in EU
With the VAT deposit, instead, the sale is an internal
operation without VAT liability.
Releasing goods in deposit, therefore, you can properly carry
out the intra-community sale without VAT.
STOCKING OF GOODS IN VAT
DEPOSIT
NATIONAL COMMUNITY
OP. Invoice without VAT OP.

16. Case 4: sale of national goods in EU
With the release of the goods in VAT deposit the following
operations are not liable to VAT:
– Sale of goods from national op. to community op.
– All processing operations performed at the deposit (packaging,
etc…), without exceptions
As a consequence:
– The national operator will issue an invoice without VAT and will
not fill in the INTRASTAT form;
– The community operator will have to appoint a “lightweight” or
“heavyweight” tax representative at withdrawal time

17. Case 5: sales between national operators for
goods traded at the Commodity Exchange
For some goods (see table in the next page) you can
enjoy the benefits of the VAT deposit, although the sale
takes place between two national operators.
In this case sales are executed without VAT liability
(invoice without VAT).
These goods are generally those that are traded at the
Commodity Exchange, that is goods that are exchanged
with sales in chain without being physically handled.

18. Case 5: sales between national operators for
goods traded at the Commodity Exchange
Tin Olives
Copper Seeds and segments
Zinc Tea
Nickel Non-roasted coffee
Aluminium Raw sugar
Lead Wool
Indium Loose chemical products
Cereals and potatoes Mineral oils (including propane,
butane, crude petroleum oils)
Seeds and oil fruits Cocoa grains, raw or roasted
Coconuts, Brazil nuts and cashews Silver and platinum

19. People who will benefit most
• Who needs to reduce his financial exposure
• Who ships to the EU
• Who starts an import – export activity
• Who stocks good at the customer company
• Who carries out few operations distributed along time