Omitted or late VAT payment: how does the sanctioning system change

With the approval of the new legislative decree on tax sanctions on 24 May, by the Council of Ministers, the rules relating to violations due to omitted or late payment of VAT undergo important changes, both on an administrative and criminal level. These new rules, which will soon be published in the Official Gazette, introduce significant changes
in the management of sanctions.

Administrative sanction

The administrative penalty for late or omitted VAT payment is slightly reduced, from 30% to 25%.

However, other aspects of the legislation remain unchanged, such as the reduction of the penalty to 50% if the delay does not exceed 90 days and the further reduction to 1/15 for each day of delay for payments made
within 15 days.

Criminal sanction

The deadline after which the crime of failure to pay occurs is changed. Instead of the due date for the payment of the following year’s VAT deposit, the deadline was extended to 31 December of the year following the filing of the annual VAT return. For example, for the 2024 tax year, with an annual return by April 30, 2025, the new deadline will be December 31, 2026.

The amount of the payment and the condition of the taxable person that triggered the crime have been modified as follows:

  • Subjects without an installment plan: the crime occurs if the unpaid amount exceeds 250,000 euros.
  • Subjects with a regular installment plan: the crime does not arise.
  • Subjects with a lapsed installment plan: the crime occurs if the amount of the remaining debt exceeds 75,000 euros.

Practical examples

For example, for the 2024 tax year, with an annual VAT return by April 30, 2025, the new deadline to avoid the crime of failure to pay will be December 31, 2026. If the taxpayer does not have an installment plan or the plan has lapsed, the crime will start if the amount not paid exceeds the specified thresholds

Causes of non-punissibility

Among the causes of non-punissibility, there is the case of a supervening event not attributable to the author. The judge must take into account the author’s non-transitory liquidity crisis due to the insolvency of third parties or non-payment of credits by public administrations, as well as the impossibility of overcoming
the crisis with other actions.

For the non-punisability of the crime due to the particular tenuity of the fact, the judge will evaluate, in a predominant way, one or more of the following indices:

  • The amount of the variance of the evaded tax compared to the threshold value.
  • Full fulfillment of the payment obligation according to the installment plan.
  • Entity of the remaining tax debt in the process of being paid off by installment.
  • State of crisis of the debtor according to the Code of Business Crisis and Insolvency.

Additional rules

The legislative decree also includes other rules relating to sanctions for VAT purposes, including the use of undue tax credits, unfaithful declaration, undue deduction and new measures of industrious repentance.

The changes made to the sanctioning system for the payment of VAT aim to make the regulatory framework more flexible and adapted to taxpayers’ situations of financial difficulty. It’s crucial that taxpayers are aware of these new rules and deadlines to avoid heavy penalties. The new system offers opportunities for repentance and reduction of penalties, encouraging the spontaneous regularization of
fiscal positions.

To stay updated on these news and to better manage your tax obligations, it is advisable to consult official communications regularly and, if necessary, to contact a tax advisor.

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