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biofuels CIC - accounting & taxation - taxation

Purchases and sales on the CIC market shall mean supply of services and the chargeability of VAT depends on the place where the purchasing market participant has established his/her/its business, as per article 44 of Directive 2006/112/EC.

Transactions with counterparties established in Italy will be invoiced by GME to Italian market participants, or by the latter to GME:

1) without VAT if the transaction is referred to CICs issued for biomethane. The purchaser will apply the reverse charge mechanism pursuant to Article 17, paragraph 6, letter d-ter) of the Decree of the President of the Italian Republic No. 633/72;

2) with application of the VAT standard rate if the transaction is referred to CICs issued for biofuels other than biomethane.

In relation to numbers 1) and 2) above, the VAT Scheme of the following types of CICs is specified below:

  • CIC biofuels:
    • CICs issued for biomethane, VAT will be paid through the reverse charge mechanism;
    • CICs issued for biofuels other than biomethane, VAT will be paid in the ordinary way;
  • CICBMTAV advanced biomethane: VAT will be paid through the reverse charge mechanism;
  • CICAV other advanced biofuels: VAT will be paid in the ordinary way.

No VAT will be applied on sales to EU market participants who/which are taxable persons in their own countries. In this case, the reverse charge will be applied by the customer.

No VAT will be applied on sales non-EU market participants pursuant to articles 44 and 59, para. 1 a), Directive 2006/112/EC.

For purchases from both EU and non-EU market participants, GME will receive an invoice without VAT and then will apply the Italian VAT under the reverse charge mechanism, pursuant to article 17, para. 2 of Decree of the President of the Italian Republic No. 633/72.

GME’s fees

The services supplied by GME S.p.A. shall mean supply of services and the chargeability of VAT on the related fees shall depend on the place where the customer has established his/her/its business, as per 44 of Directive 2006/112/EC.
Therefore, GME will issue an invoice with VAT at the standard rate if the customer has established his/her/its business in Italy and without VAT if the Italian customer qualifies as “esportatore abituale” (Italian exporter on a permanent basis) pursuant to Article 8, para. 1, subpara. c) of Decree of the President of the Italian Republic No. 633/72.
Conversely, GME will issue an invoice without VAT to EU customers who/which are taxable persons in their own countries. In this case, the customer will apply the reverse charge.
In the case of a non-EU market participant which is a taxable person, GME will issue an invoice without applying VAT.

GME’s VAT codes

GME’s SALES
VQ = reverse charge sale as per art. 17, para. 6, Decree of the President of the Italian Republic (“DPR”) 633/72 – reverse charge for the sale of CICs related to biomethane
V1= sale subject to VAT at the standard rate for CICs related to biofuels other than biomethane
VE = sale to PA subject to VAT at the standard rate - Split payment for CICs related to biofuels other than biomethane
VX = sale to non-PA subject to VAT at the standard rate – Split payment for CICs related to biofuels other than biomethane
V8 = supply not subject to VAT as per art. 7ter, DPR 633/72 - art. 44, Directive 2006/112/EC – EU reverse charge
VC = supply not subject to VAT as per art. 7ter, DPR 633/72 - art. 44, Directive 2006/112/EC – non-EU reverse charge


GME’s PURCHASES
AQ = reverse charge purchase as per art. 17, para. 6, DPR 633/72 - reverse charge for the purchase of CICs related to biomethane
AX= purchase subject to VAT at the standard rate - Split payment for CICs related to biofuels other than biomethane
A7 = purchase from EU customer not subject to VAT as per articles 44 and 196, Directive 2006/112/EC EU reverse charge
A8 = purchase from non-EU customer not subject to VAT as per articles 44 and 196, Directive 2006/112/EC non-EU reverse charge


GME’s FEES
V1 = supply subject to VAT at the standard rate
V3 = supply to the so-called “esportatori abituali” (Italian exporters on a permanent basis) not subject to VAT as per art. 8, DPR 633/72
VE = supply to PA subject to VAT at the standard rate - Split payment
VX = supply to non-PA subject to VAT at the standard rate – Split payment
V8 = supply not subject to VAT as per art. 7ter, DPR 633/72 - art. 44, Directive 2006/112/EC – EU reverse charge
VC = supply not subject to VAT as per art. 7ter, DPR 633/72 - art. 44, Directive 2006/112/EC – non-EU reverse charge

 
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