TUNGSTEN NETWORK

Italian SDI cross-border invoice reporting

Italy tax reporting requirements - July 2022 (postponement from 1st January 2022)

Since 2005 Tungsten has supported compliant invoicing in Italy and in 2018 became an authorised intermediary to validate, send and receive domestic B2B invoices through the Sistema di Interscambio (SdI). Tungsten also offers a compliant e-archiving service for invoices and documents flowing to the SdI.
Italy’s invoicing legislation covers three areas for buyers and suppliers to satisfy:

E-invoicing

In 2018 we became an authorised intermediary to validate, send and receive domestic B2B invoices through the Sistema di Interscambio (SdI) in accordance with their mandate. Italy introduced their invoicing to recoup its €34 billion VAT gap.

E-reporting

Since 2019 Italian Buyers and Suppliers have been required to report import and export invoices to the Agencia delle Entrante (AdE) via the Esterometro once a quarter. Come January 1st this is changing, read on for buyer and supplier impact.

E-archiving

The Agency for Digital Italy (AGID) had planned to introduce some new requirements relating to Italian e-archiving, postponed from 7 June 2021 to Jan 1st 2022. Read more information on our archiving service below.

So what is changing in July 20221

For domestic e-invoicing nothing is changing. Tungsten will continue to process invoices between Italian Suppliers and their Italian Buyers as we currently do today.

What is changing in July 22' is the reporting of cross border invoices in terms of how the reporting is done and the frequency of the required reporting from quarterly to within 12 days of the invoice being issued.

From the Agencia delle Entrante (AdE) Esterometro once a quarter TO via the Sistema di Interscambio (SdI) within 12 days of invoice date

Cross-border invoices include:
  • Invoices sent from Italian suppliers to non-Italian buyers (sometimes also referred to as sales invoices); and
  • Invoices received by Italian buyers from non-Italian suppliers (sometimes also referred to as purchase invoices)

Supplier changes & service offer

The good news is that as an existing supplier on the Tungsten Network you can continue to use Tungsten Network to submit e-invoices to buyers as per your usual process, we’re just adding an additional free service!

We’re removing the burden of reporting for you!

From July 2022 Tungsten will ALSO e-report ALL export invoices on your behalf without any additional changes being made by you. This means you won’t have to!*

Tungsten will report your export invoices in real time and let you know about any invoices that aren’t accepted by the SdI before the invoice is delivered to your Buyer (just as we do today!)

Tungsten will continue to deliver invoice data to your Buyer in the same format with the same field content that we currently do so they will see no disruption to the service.

Tungsten will provide the same e-archiving services to your cross-border sales invoices that we currently provide for your domestic invoices.

Technical details
The data format for reporting invoices is the same as the Fattura 1.6 format that is currently used for domestic invoices. So as a supplier you are already compliant in providing domestic invoices to your buyers, you are already compliant for the cross-border reporting of sales invoices.

There are two domestic data points you send today that won’t be valid for foreign buyers. In accordance with SdI recommendations we will auto populate these fields on your behalf to avoid the SdI rejecting your invoice. These are:
  • Post Code: A foreign buyer won’t have a postcode that follows the standard Italian 5 digit pattern so Tungsten will auto-populate this field with 00000 (5-0) to avoid the invoice being rejected by the SdI
  • Codici Destinatario: A foreign buyer won’t have a Codici Destinatario so Tungsten will auto-populate this field with XXXXXXX (7-X) to avoid the invoice being rejected by the SdI.
  • *If you wish to opt out of Tungsten e-reporting your invoices to the SdI please raise a ticket with our support team any time. 

Buyer changes & service offer

The July 22' cross border e-reporting requirement is for buyers to report details about their purchase invoices directly to the SdI.

Buyers must report by the 15th of the month following the month of receipt of the Purchase invoices.

Tungsten is offering a new real time e-reporting service for these invoices on behalf of new or existing buyers, including intercompany cross border purchase invoices too. 

*Important* We are currently seeking guidance on the capability of the SdI to recieve e-reports during the voluntary period between January and July 22 in order to offer this service as soon as possible to customers. 
  • Existing customers will incur a profile remap cost for Sdi e-reporting
  • New customers, not currently sending domestic invoices through Tungsten today, will incur a setup fee and per transaction costs.
  • Tipo Documenti (tax documents) specific to purchase invoices are supported within the e-reporting process by the SdI. For example: TD16, TD17, TD18 and TD19.
We also offer e-archiving services of the invoice and tax documents after they’ve been submitted to the SdI too. For existing customers this will be per document stored or a new archive cost for setup and document storage if you don’t currently send e-archive domestic invoices through Tungsten.
  • For archival of the TD tax documents, Buyers must nominate Tungsten as the Codici Destinatario on the SdI portal.
  • When the SdI have accepted the invoice reporting they will send the tax documents to Tungsten for us to archive.
If you would like Tungsten to provide e-reporting or e-archiving of your invoice and tax reporting documents, please reach out to your Client Account Manager to initiate setup.

E-archiving changes from January 1st, 22

The Agency for Digital Italy (AGID) had planned to introduce some new requirements relating to Italian e-archiving on 7 June 2021, this was subsequently delayed and is due to go live on 1st of January 2022. 

The changes are complex and will include a new set of structured metadata rules. This will affect the metadata stored with the invoice. Want to know what metadata is? This is what Wikipedia say

We're happy to advise that Tungsten Network will remain compliant with the new e-archiving rules from January 1st and there is no requirement for customers to do or change anything.

Frequently asked questions

Can you report cross-border transactions to SdI ahead of the deadline of July 1, 2022?
Yes. We have clarified with our partner PwC that Italian businesses can choose to use the cross-border reporting to the Sistema di Interscambio (SdI) ahead of July 1, 2022, instead of continuing with the Esterometro reporting. There are no requirements to formally apply or inform the tax authorities if you decide to use the cross-border reporting to SdI.

Will Tungsten Network report my cross-border transactions to SdI before July 2022?
Yes. From January 10, 2022 Tungsten Network will automatically report your cross-border transactions. This automatic reporting will be for those foreign buyers you invoice via the Tungsten Network.

Can Tungsten Network report ALL your cross-border invoices to the SdI?
Yes. If you are a Tungsten Integrated Supplier, all you need to do is to include all your cross-border transactions, including those with foreign buyers that are not on the Tungsten Network, in the data file that you send to Tungsten Network, so that Tungsten Network can report these invoices to the SdI on your behalf. Your Tungsten account will not need additional rework.

Note: The Tungsten Web Form does not yet support the reporting of cross-border transactions with buyers that are not on the network. We are expecting to provide you with this functionality in the course of February 2022.

What are the costs if Tungsten Network reports these cross-border transactions to SdI?
Tungsten will charge each transaction reported to SdI at your standard transaction rate.

What do you do if you do not want Tungsten Network to automatically report cross-border transactions to SdI?
If you do not want Tungsten Network to perform the cross-border reporting to SdI, please raise a ticket to Tungsten Network support and clearly state that you want to opt out from the automatic reporting. Please ensure that you do this before January 10, 2022. From January 10, we will start to report transactions with buyers on the network automatically to SdI.

Can you partially report to the SdI?
Yes, it is allowed to use partial reporting to the SdI, meaning that those invoices you do not report to SdI still need to be reported to AdE via the Esterometro report.

What happens if the proposed delay is not passed into law?
This is very unlikely. However, if this happens, we will inform you immediately. Tungsten Network is ready to support you should this happen.

I have more questions, can you help? 

Certainly, we're always here to assist, you can raise a ticket with our support team or call direct if something isn't covered here. 


Disclaimer:
You acknowledge that nothing in this communication is fiscal or tax advice, merely operational advice you need to comply with for Tungsten Network to maintain its services to you. Tungsten Network is not a tax advisor. For any questions or advice concerning fiscal or tax matters, please consult a specialist.


1Correct at the time of publishing
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