IVA Options: Choose Your Regime by April 30th

IVA Deadlines: What You Need to Know

Attention all VAT deadlines! By April 30th, taxpayers with a VAT number can exercise their VAT options to switch from the ordinary regime to the flat-rate regime and vice versa.
It is essential to submit the annual VAT return by April 30th, 2024.
This is a requirement for those who have chosen to independently file the periodic VAT return for the 4th quarter of 2023.

Understanding VAT Options

According to Article 1 of Presidential Decree 442/1997, opting for different tax regimes can be done by evident actions from the taxpayer or by the way accounting records are kept.
The option and its revocation are generally valid for three years.
Nonetheless, there are situations where it is necessary to switch from one tax regime to another.
This process is straightforward and involves just a few steps.

If transitioning from the flat-rate regime or from the ordinary regime to the flat-rate regime, taxpayers must tick box 1 in section VO33 of the 2024 VAT return.
This selection also applies to those who, although eligible to remain in the flat-rate regime, opt for the ordinary regime—perhaps because they find the deduction of expenses more advantageous using the analytical method.
The chosen option is valid for three years.

Switching from Ordinary to Flat-Rate VAT

Individuals who have revoked the option for the ordinary regime, thus selecting the flat-rate regime for the 2023 tax year, must tick box 2 in section VO33 of the 2024 Income Tax return—due by October 15, 2024—along with attaching specific forms.

For those adopting the flat-rate regime for the first time in 2024, they must tick box VA14 in the 2024 VAT return for the 2023 tax year to indicate that it is their last VAT return filed.
As a result, they will be exempt from submitting the VAT return for the 2024 tax year in 2025.

Article 2 of Presidential Decree 442/1997 specifies that the taxpayer must communicate the option outlined in Article 1 in the first annual VAT return following the choice made (based on conclusive behaviors).
Penalties between €250 and €2,000 apply for late communication, despite the option’s validity.

Furthermore, VAT return 2024 can also be used to opt between monthly and quarterly VAT returns.
Remember, taxpayers with a turnover not exceeding €500,000—excluding certain transactions—are eligible for quarterly VAT payments.
The €500,000 limit applies to professionals, self-employed individuals, or service-oriented companies; otherwise, the threshold is raised to €800,000.