The self-invoice  is a fiscally relevant document issued by the taxable person to himself as the transferor/transferee, or as the transferee/client (customer) on behalf of the transferor/provider (supplier).

One of the unique features of self-invoicing is that, when it is issued, the obligation to apply VAT and issue an invoice falls to the recipient, rather than the supplier. To properly manage these operations and avoid penalties, the professionals at Iorio Associati offer specialized support in configuring electronic invoicing systems and ensuring tax compliance.

This is an institution deriving from the legislation on Value Added Tax (VAT) which can be used only in specific cases.

The self-invoice, being a valid document for VAT purposes, with some exceptions, must be issued in electronic format and sent to the SDI.

When issuing self-invoices,  special care must be taken as they must have a specific document type code (TD code) and be recorded on separate sections from ordinary invoices. In this context, it’s worth remembering that the new XML format for electronic invoices (version 1.6 and subsequent updates) has become mandatory since January 1, 2021. Among other changes, this format introduces new document types for both invoices and self-invoices.
Let’s look at the cases in which self-invoices can be issued, how they must be drafted in compliance with the rules for electronic invoicing, and the new document types for self-invoices.

When to issue a self-invoice

Transactions carried out by non-EU entities with territorial relevance in Italy are subject to self-invoicing, as are certain domestic transactions under national VAT legislation. Self-invoicing is also required if the invoice was not issued within the required timeframe by the entity responsible, or if the document is found to be irregular.
Therefore, self-invoicing is issued in the following cases:

  • free transfers as gifts , for example to register a service/product offered free of charge to a customer;
  • self-consumption : the company’s assets are used for a purpose other than that of the business, for example when a product is needed for personal use;
  • Reporting , in the event of non-receipt of an invoice or the correction of an incorrect invoice within four months of the invoice date. In this situation, the transferee/client must correct the invoice by issuing a self-invoice within the following 30 days;
  • internal transfers between separate VAT activities  carried out by the same taxable person;
  • collapse  of the habitual exporter;
  • Extraction of goods from a national VAT warehouse  : the purchasing entity proceeding with the extraction issues a self-invoice for the purchase, making the annotation only in the purchase register;
  • Reverse charge , to proceed with the invoice integration in cases where the reverse charge regime referred to in Article 17 of Presidential Decree No. 633/72 applies, the specific tax mechanism that shifts VAT obligations to the recipient of a supply of goods or services, if a taxable person within the territory of the State, instead of the supplier. In practice, by applying the reverse charge mechanism, the supplier/supplier issues the invoice without charging VAT, while the recipient of the supply or service is required to integrate the VAT on the invoice based on the rate applicable to the transaction. In the case of VAT transactions with taxable persons resident or established in Italy, this is referred to as  internal reverse charge . Conversely, for transactions involving the purchase of goods from operators resident in intra-EU countries or the provision of services received from subjects resident in non-EU countries, this is referred to as  external reverse charge . When purchasing services or goods from abroad, foreign transactions that are territorially relevant in Italy for the customer/buyer result in the application of the reverse charge mechanism, meaning that domestic customers become tax liable instead of foreign suppliers. VAT is applied through the integration of invoices received from EU suppliers (intra-EU purchases), or through self-invoicing if the supplier is a non-EU entity.
  • purchases from  agricultural producers exempt from the obligation to issue invoices : in this case the purchasing entity must issue a self-invoice, delivering a copy to the transferring agricultural producer;
  • commissions paid to intermediary travel agencies  by the organizing agency;
  • fees paid to resellers of  travel or parking tickets  by urban public transport operators and car park managers.

How to issue an electronic self-invoice

Self-invoices, although characterized by specific features, are still invoices. To issue a self-invoice, you must follow the same rules and include the same information required for issuing a standard invoice. Therefore, you must enter the document number consecutively with respect to the previous invoice issued, the services or products for which the document is issued, along with the corresponding quantity and VAT rate.

Since the self-invoice is a VAT-relevant document, like other types of invoices, it must be prepared in electronic format and sent to the Exchange System (SdI).

Important: The wording “Self-invoicing” must be included in the document, and the invoice must be identified by a  specific document type code  and must be recorded in  specific sectional registers  separate from those containing sales invoices.

The taxable person can choose whether to issue  a single self-invoice  for each sale or  a summary invoice  for all sales made in the month.

As specified in the Revenue Agency’s guide to the new technical specifications for electronic invoicing, published on November 23, 2020, the transaction date must be reported in field 2.1.1.3 – Document Date in the “General Data” section of the XML file. For a summary self-invoice, you can choose between the date of the last transaction and a date in the reference month.

Self-Invoicing: Document Types (TP)

Below we report the  new self-invoices :

  • TD16 –  internal reverse charge  invoice integration ;
  • TD17  – integration/self-invoice for  the purchase of services from abroad  (services rendered by a foreign bank account, including one resident in the Republic of San Marino or the Vatican City State, to a bank account resident or established in the national territory;
  • TD18  – integration/self-invoice for  the purchase of intra-Community goods  (sale of goods from a current account resident in another EU country to a current account resident or established in the national territory);
  • TD19  – Integration/self-invoice for  the purchase of goods pursuant to art.17 c.2 DPR 633/72  (sale from a foreign C/P of goods already present in Italy);
  • TD20  – Self-invoice for  invoice regularization and integration  (pursuant to art.6 c.8 Legislative Decree 471/97 or art.46 c.5 DL 331/93);
  • TD21  – Self-invoice for  overdraft ;
  • TD22  – Extraction of goods from  VAT warehouse ;
  • TD23  – Extraction of goods from  VAT warehouse with payment of VAT ;
  • TD26  – Transfer of depreciable assets and for  internal transfers  (pursuant to art. 36 of Presidential Decree 633/72);
  • TD27  – Invoice for  self-consumption  or for  free transfers  without recourse.

For self-invoices issued for free transfers as gifts, personal consumption, or internal transfers between separate VAT-registered businesses, the invoice issuer, customer, and supplier are the same person. In these cases, the seller’s details will also appear in the “customer” or “transferee” section of the invoice, and the seller will receive the invoice. In these cases, the VAT ID of the person issuing the self-invoice must be shown in the “transferor/supplier” and “transferee/customer” fields of the electronic self-invoice  . The Revenue Agency’s guidance specifies that, regarding field 2.1.1.4 – Invoice number, the document transmitted with TD27 must be recorded only in the register of issued invoices.

For self-invoicing/electronic integrations characterized by the new TipoDocumento codes TD16, TD17, TD18, TD19, and TD20 starting January 1, 2021, the “transferor/provider” fields must always display the transaction counterpart’s data instead of your own. In these cases, indicating the same party as both the transferor and the transferee on the invoice generates the  new error code 00471 .

The new electronic invoice document types relating to the transmission of documents certifying VAT payment using the  reverse charge mechanism  (TD16 to TD19) refer to situations in which the customer can still fulfill the obligation (self-invoice) using traditional methods, but if the supplier is a foreign entity, it is necessary to transmit the esterometro  according to the quarterly deadlines.

If you opt for transmission to the SdI, thanks to the three new document type codes TD17, TD18, and TD19, you can avoid having to report the transaction to the Esterometro, since the information system creates an XML file to send to the Revenue Agency with the foreign supplier’s data and the VAT amount to be paid.

In this way, the new TD codes (from TD16 to TD19) also allow for the complete dematerialisation of the reverse charge phase which many still carry out in paper form by printing the foreign document received, proceeding to issue a paper self-invoice or to integrate the paper document and to store these documents in analogue format.

The other advantage of opting for electronic invoicing and the new codes TD16, TD17, TD18, and TD19 is that it allows the Revenue Agency to prepare a more complete pre-filled VAT return, benefiting the taxpayer who will thus be exempted from keeping VAT records.