In Case No. 1/2025, Assonime (The Association of ITALIAN Joint Stock Companies) comments on the recent rulings of the Court of Cassation Nos. 22608 and 22649 of 2024, in which the Court recognized the legitimacy of the deduction of VAT paid by a special purpose vehicle (SPV) in the context of merger leveraged buyout (MLBO) operations. The decisions do not share the restrictive approach of the Revenue Agency, aligning instead with the principles of the EU Court of Justice, according to which, as highlighted by the Court, even preparatory expenses for the start of an economic activity can generate a right to deduct.
The Revenue Agency had, in fact, so far denied the deductibility of VAT incurred by an SPV that did not engage in direct economic activities but merely held shares, without appreciating the preparatory function of these vehicles which is then to proceed with their integration with the target. The Court, however, recognized that such companies, although operating in a preliminary phase, are functional to the acquisition of the target and the subsequent merger, which makes them taxable persons for VAT purposes.
Following the new judicial orientation, the issue arises regarding the recovery of non-deducted VAT by those who, adhering to the restrictive interpretation of the Administration, did not exercise the right to deduct within the legal terms. The two possible solutions hypothesized by Assonime are recourse to the supplementary declaration or the request for reimbursement of the unduly paid tax. Both solutions present critical aspects highlighted by Assonime.
In the presence of uncertainties about the recovery methods, a clarifying intervention by the Revenue Agency would be desirable to harmonize practice with the judicial orientation.
